Hello Bigger Pockets community!
This is my first post in the forum, and I wanted to say that I just love how insightful this community is, and I've taken my RE addiction to the next level because of you all. That said, I am looking for advice in my next move in the fine world of RE. First I would like to share my story so far in the business. If you don't want to read my background jump to the bottom for my question.
My girlfriend and I were living together in Seattle in 2013, I had a pizza delivery job and she was working at a gift shop in a museum. I got a call from my dad saying that I would be getting a rather large inheritance after my late grandmother, Natalie, passed away, and he thought I should spend it on Real Estate. I'm from Des Moines, Iowa, and the money would have been enough to buy a few houses out there, but we were in Seattle and couldn't afford a decent single family home. My agent showed us a 1 bedroom bank owned foreclosed condo (with a view) that had just come back on the market after not closing from a previous deal. It was a score. The building is small, about 15 units mostly 1-3 bedrooms. I loved it, it was in the price range, just under 1,000 sq ft. and there was a bunch of improvements I could make to boost the equity. So I quit my pizza deliver job and did a complete remodel. I had never done construction before so I learned the essencials of hiring people (I contracted my own labor) and picking out the materials, light fixtures, wiring, tubs, all that good stuff. It took longer than a seasoned flipper would have taken, like 5 months, but I did it, the place looked great, like really good, I had the bathroom decked out in marble from home depot.
but we were in our late 20's living at a condo in the uber rich part of Seattle, Upper Queen Anne. I felt disconnected from my friends, and roots in the Seattle art scene. I decided soon after moving in that it was time to make the next move. The HOA only allows a small percentage of units to be rented out and they were already at that mark, so renting it out was off the table. I had to sell if I wanted to move. Given the market in Seattle that wouldn't be hard. It wasn't. We had an open house on a Saturday Starting at like 2pm or so. At around noon an agent knocked on the door and wanted to see it. I said come back later during the open house, I'm sweeping! She was persistant and said "Well i'm here, cant I just see it please?" I thought, well I guess so. The agent said she had a potential buyer who was out of the country and won't be home for a week.
Fast forward, open house went great, lots of people checked out the place. But no offers right away. We got one offer a couple days later and my agent thought it was a good one. Asking price with a healthy down payment, I accepted with a counter offer. They came back with another counter offer that was 10k less than the original offer! Now I was a little upset. These folks knew that nobody else was making offers so they used this to their advantage. Well my realtor said "look Woody, I know this sucks but most of the good offers come in the first week" I thought, ok fine I accept. So we sent in the counter offer. But we didn't hear back right away. Thats all fine and dandy, I didn't really know what I was doing and I'm along for the ride. Well, remember that realtor who's client was out of the country? She came back, and not a moment too soon. Buyer made a cash offer of the full asking price! Meanwhile, the jerks who went down on their price had still not accepted my counter offer! At the time I was visiting my friends in who own a rad barcade (arcade with beer) close by my house. I finished my beer, borrowed a skateboard and rode to the nearest kinkos-Fedex office and quickly sent the important documents to my realtor to get out of the old deal before they accepted it. It worked! I saved 10k that day. And I think the buyer was a better fit for the building. (I certainly was not)
I put all my money into the next deal. A 3 bedroom 2 bath single family in Beacon Hill, Seattle. We wanted to be closer into town but it was too competative and we lost a couple offers, so we went further out. After the condo deal I thought I had super powers and could do anything. So I started a food truck. We rented out a room in the house and I switched gears. I did pretty well, (because I like marketing) but didn't like all the hands on and no time to myself. I have family in Iowa I couldn't visit and my girfriend has family in Massachusettes we couln't visit. This is not what life is about. I was always tired and eating cheeseburgers and trying not to get ripped off by vendors, employees, landlords and other food trucks. Not my cup of tea. So I sold all the equipment and broke even.
Here's the lead up and Question
My girlfriend and I decided to move to Los Angeles. I rent out the house managed by Coldwell Banker Bain at 10%. The Margins are excellent considering I have no loan payment.
Here in LA we are paying 2k a month in rent. My girlfriend has found a good full time job, and I am studying for my CA real estate license. I want to land a job and have some income so I'm bankable, but it could be a couple years before I'm making steady income. which means a couple years of spending 2k a month on rent. Thats nearly 50k waisted! I want to make a deal sooner that 2 years. I'm looking to refinance my own house or something creative. I'd like to find a duplex, triplex, or quad to house hack. I don't plan on selling my Seattle home, Im riding a wave. like 7-16% property value increases annually and great income. I'm just starting out kinda so I would imagine the banks want to make some money off me before I get the low interest rates.
Any Advice?
-Woody
