All Forum Posts by: Aubrey P.

Bumping this thread. I live in DC and am looking to 1031 a ski condo worth about $650K I have in Colorado into something to rent out in DC or close in exurbs. The tip about the Anacostia Riverwalk is helpful. What about Deanwood? Tons of development there. Or Historic Anacostia?

I own several boutique "row house" style commercial buildings in NW dc, rent it out, and can relate. My family has owned these since the early 70's, bought at rock bottom prices, and are the beneficiaries of appreciation. It's a unique rental market for people who own these types of buildings.

In renting mine, I first tried to market several of the units in these buildings myself using craigslist, facebook, 43floors, and several other free sites with varying degrees of success. I am unique in that my small properties are right next to Congress and there is a niche market for lobbyists, 501c3's, etc needing close proximity to the seat of power.

Because of the unique nature of these buildings, and the more recent competitive nature of dc commercial real estate, with vacancies increasing generally across the board city wide, and more options for commercial tenants, when tenants did recently leave and I needed to find new ones I bit the bullet and enlisted the help of a landlord side commercial realtor. This was beneficial in that they drafted an iron clad lease with rent escalation clauses, and were able to draw from a wider pool. They took one months rent, but it was helpful to have their services.

Your property is unique in that it's in Ledroit Park. I don't know exactly where, but that area is generally bars near U street, restaurants, corner market type of commercial stuff. I wonder if you could get a boutique coffee shop in there.

I own a ski condo in Colorado, which generally breaks even as a rental or cashflows a little, but is more for family skiing than anything else. That said I think it’s more advantageous to sell and invest in another property where I can get cash flow. Also, other condos on the same floor as my place in Colorado are selling for $600-650K.

I moved to Washington DC and would like ideas generally on 1031 exchanges and investing in the area. I'm open to small commercial properties under $1.2M, multifamily properties, or a nice rowhouse, within the city in areas like Capitol Hill, U Street area, Tenley, AU Park etc, or close in exurbs (Arlington, etc.) to rent out. It's very hard to find a multifamily in a decent areas in DC proper. I could look to Ward 7 or 8  to upcoming areas that may include the advantages of an Opportunity Zone property...but I'd rather stay in a more desirable location like what I mentioned previously. I know people are buying and building in Deanwood and some of the historically more dangerous areas. Even historic Anacostia is undergoing huge development. Maybe I could buy and sit on a commercial property there?

Anyone have any good ideas? It ain't 1982 anymore and you're not going to find a rowhouse on the Hill for $50K, but any input is helpful. Maybe a condo to rent?

I own a ski condo in Colorado, which generally breaks even as a rental, but is more for family skiing than anything else. That said I think it’s more advantageous to sell and invest in another property where I can get cash flow now. Also, other condos on the same floor are selling for $600-650K.

I moved to Washington DC and would like ideas on how to buy something there and generally ideas generally on 1031 exchanges. I'm open to small commercial properties under $1.2M, multifamily properties, or a nice rowhouse, within the city or close in exurbs (Arlington, etc.) to rent out. It's very hard to find a multifamily in a decent areas in DC proper. I could look to Ward 7 or 8 and consider the advantages of an Opportunity Zone property...but I'd rather stay in a more desirable location.

Anyone have any good ideas? It ain't 1982 anymore and you're not going to find a rowhouse on the Hill for $50K, but any input is helpful. Maybe a condo to rent?

That’s what I was getting at. I’m liberal as hell, but woke housing policy is going to try to force small landlords’ hands to accept tenants they may not otherwise want. If they water down how credit scores are measured, or even remove the ability to use a credit score as an allowable piece of the tenant vetting process, which I’ve seen some propose than it will hit small landlords hard. Small landlords are 70% of landlords in the United States.

Also, I’ve read that adding a minimum income (E.x. “Must earn 40x the monthly rent per year”) listed in a rental ad on Zillow or one of the listing sites has been grounds for a lawsuit, as it was deemed discriminatory. I’m on a cell phone otherwise I’d try to Google info on the case. Essentially, Biden is doing there complete opposite of trump, reinvigorating fair housing policies, but also adding bold new pieces and someone could get in trouble if their currently allowable vetting methods result in disparate impacts, however unintentional. Biden’s housing policy advisors are the type of folks who really want to push tenants on you out of fairness.

As a landlord, who relies on credit scores and other pertinent information to vet renters, I’m concerned about Biden’s latest Executive Order. He’s looking to try to ensure racial equity by a change in how credit reporting is measured to include things like cable bills being paid. Increasing section 8 vouchers and the amounts allotted, among a slew of other proposals.

My concern, and I preface this by saying I am pro-racial equity, will be that it could decrease the tools for which to weed out potential problem tenants with poor credit histories, or generally that this could lead to litigation for small landlords.

anyone see this EO? All I know is I can use credit scores now to help weed out tenants, but I just don’t know the full ramifications of this yet.

Thanks. That's very helpful, Joseph.

Good morning, I am putting a 2 bedroom condo for rent in DC, and want to ensure there are no issues with DC fair housing codes, and discrimination, but also want a stringent screening process. How do you structure your application process, or rental application, or rental agreement, to avoid discrimination claims? I fear I’m not 100% versed in what I can and can not ask a prospective tenant. There are so many legal pitfalls because this city is overwhelmingly slanted toward the tenant’s side. What do you ask when looking to rent? I know you can’t say “no vouchers” etc, but can you specifically ask for a credit score? What language should I, off the bat, put into the ad online to vet out poor candidates? Are you not allowed to ask about criminal history, or at least preclude someone based on a criminal history? Any tips for an iron clad lease, rental application and the actual rental ad are appreciated.

I am meeting with the bank that currently holds the $1.2m line of credit on the property next week, so I can discuss ways to take on $600K of that debt. My $600K piece of that needs to be turned into a mortgage. The building was recently condo'ed. There is another buyer of the other $600K who will assume that debt in a few months, so I don't need to worry about that.

So the options I have seen so far for financing $600K are to:

1) Get a second mortgage or home equity line of credit against my other capitol hill house (worth $1.1M and has $130,000 left on that mortgage, but the loan is with a different bank than the one I am meeting next week)
2) Get a second mortgage or home equity line of credit against on the other rental condo (worth about $650K) to help pay for a down payment and loan.
3) Get an FHA loan

or Would it be worth trying to package together the $600K to the amount left on the mortgage I have on my old house ($130K left on that) with the the other bank?

Thank you!

What is FMV?

       This is a two condo building with each unit worth $1.5M. The new condo I will move to is essentially worth $1.5M.

What did you pay?

     My relatives built the building. There remains $1.2M outstanding on a line of credit with the bank they used to pay for the construction of it. My price will be $600,000 (or the price to pay off one of the units) and to assume that portion of the remaining 1.2M debt. I have not paid anything yet.I am just looking for the best way to keep my other two properties.

How much do you still owe on the condo?

On the other rental condo there is nothing remaining. That was paid for by wife 15 years ago in cash. It produces rent, but has a condo fee of $700 per month.

Essentially, I am very fortunate to be in this position, but don't want to sell my other income producing rental properties to buy this condo. However, I am not fully up on the best ways to finance a new property, because I am novice investor and sort of happenstance landlord.

One consideration is that Covid could have ramifications for real estate values far beyond what we anticipate now or can foresee. Perhaps we've reached peak value, and the gloomy economic forecasts will translate to downward housing sales prices in the future. Perhaps selling now while the market is still hot and there are buyers is prudent. However, my gut tells me its better to hold the course, keep those properties and expect historical trends hold true and that in 20 years I will have been happy to have held them rather than have sold them. It's very hard to predict. Interest rates are incredibly low now, but we could run into anything going forward when we have so much debt. We're printing tons of money. We could see stagflation etc. We could even see a return to the late 70's, early 80's where interest rates were 19%. I have no idea.