All Forum Posts by: Lane Kawaoka

Looks like a good rental but numbers aren't quite as sweet. With an acquisition price of 200k you are looking at a PITI of 1050 per month. For a newer rental like this I would estimate 20% of the income going toward management and repairs. Then minus the HOA.

1700 (optimistic rent) x80% minus HOA = breaking even. Now add in vacancy... sorry I think its just the market that we are in.

I think your 8% vacancy is a good estimate since its not too populated area.

Overall you would be breaking even. I might jump on this if you had a little more upside with appreciation (if it were in Seattle).

Seattle and high cost west coast areas are poised for appreciation. The way i see it you make your money with cash flow or appreciation. The prudent investor will not count on appreciation but in the forementioned areas its part of the market and why you are buying into the area. As always it comes down to goals.

I posted a graphical representation of the SFH market in Seattle and wanted to know what folk think.

1) Have we turned the corner and in a Sellers Market 2 (tern coined by duru Dave Lindel)?

2) If so what is the best thing to do?

http://theunconsensus.blogspot.com/2014/03/sfh-real-estate-market-in-northwest.html

I hate to be the bearer of bad news in the NW. If you are looking for B, B+, A-, A properties I think the ship has sailed 12-6 months ago. IMO the margins are so razor thin due to increasing prices and increasing interest rates. A property in 2009 that was 350k and 2200 rents was cash flowing at a few hundred a month... now it would go for 400k and 2300 rent. Again sorry about being a Debbie Downer but I just don't want us to kid ourselves that we are on the upper end of the cycle. Owner occupied multi-units that are B- or less will still work today however. I believe there is a time to buy and a time to run with our tails between our legs and pay down some of our loans/save opportunity funds.

I would say no. But it is up to the interpretation of an IRS lawyer, this is somthing you definately don't want to screw around with.

Your spot on Eric. Seattle is 1% or less.

Some people aren't comfortable investing out of their home area.

That condo looks amazing (in terms of price) however a big red flag is the 400+ hoa which will totally kill the deal. I don't know much about HOA/Condos but it takes someone with a little experience to determine if the HOA the condo is apart of is not a toxic situation.

Maybe buy a rental in U-district and offer 9 month leases. When I was a student we typically ate the costs when everyone when home for the summer. Could be a both win deal.

The vacation rentals are usually for those bargain hunters or those who would like a more authentic experience. I can see these people going to Hawaii to escape everything but I can't really see it happening in Seattle (City). Maybe more in the Snohomish where there is more of a draw to the outdoors/snow season.

Hi, I invest buy and hold in seattle. nice to meet you