All Forum Posts by: No Jo

I'm currently evaluating properties in the suburbs of Seattle and am having trouble finding anything that cash flows.

The best situation i'm finding is a SFR for 180k that will rent for 1600. So far my search has been focused in Everett since that's the only place where market rents come close to covering the mortgage. is there a price break for more expensive homes in the greater Seattle / Everett area? I'm looking at either a SFR or 2-4 units and can afford up to 400k as I need owner occ financing.

Using the above numbers (180k loan that rents for 1600) and assuming a $1200 mortgage payment I get a monthly cash flow of -400 and using the 2% rule i'm coming up with a required monthly rent of 3600 to support a relatively cheap home in a B- / C neighborhood.

Am I misinterpreting the calcs or is the situation really that bleak for 1-4 unit properties in this area?

thanks!

I've found a duplex that i'd like to go view. Based on the pictures and description up on MLS it looks like it would require minimal work. However, I'd need FHA financing and it appears that this duplex is fully occupied and closing is subject to tenant rights. I figure this means I would need to honor any leases currently in place.

1. Other than asking about the leases in place, are there any other questions I should ask regarding the current tenants, history of the property, or anything else?

2. Will the closing subject to tenant rights affect my ability to get financing? I believe I need to move in within 60 days to get owner occ financing.

3. Do i need to be preapproved by a lender before going to view the property? It costs about 2x my annual (stable) income and i have good credit so I don't foresee qualifying for the loan being a problem except for potencially the downpayment.

This duplex looks quite good and has been on the market for almost 6 months with multiple (small) price drops. Is it possible that no-one has purchased it since they can't get FHA financing (due to long term leases) and it's too small to bother for an investment loan? On the mls it says that FHA and VA financing is accepted.

Thanks!