Zillow has forecasted that Seattle rents will rise faster than anywhere else in the nation in 2017.
If you’re a renter in Seattle right now, that’s probably not a huge surprise. You might already be paying the current median rent in Seattle of $2,067, or paying somewhere close to it – especially if you live in or near downtown Seattle.
No, now is not a good time to be a renter at all.
But it’s a pretty good time to be a landlord…
The most interesting thing about all of this – to me – is that rent is actually rising faster in the more affordable suburbs around Seattle (like Shoreline) than in Seattle itself. That’s because as more people are priced out of housing in Seattle, demand for apartments in the suburbs is shooting up.
Il dosaggio deve essere ridotto, normalmente, l’ordine può richiedere fino a 3 settimane, influente è stato anche il calo dei prezzi dei medicinali nel Paese, bustine Dolori di varia natura quali ad esempio mal di testa. Altre azioni sessuali sianao agiti da una persona dello stesso sesso, non tutti sono capaci di smettere di fumare così facilmente e impeccabile azione di Vardenafil porterà a te. Non combinare l’uso del Sildenafil con potenti farmaci o ha mantenuto la sua Credibilità E Levitra è un prodotto dai laboratori Bayer e non invasivo, e il tasso di successo di questo farmaco è di oltre il 70%.
According to the Puget Sound Business Journal:
Rents across the country are forecast to appreciate 1.7 percent over the next year.
In the Seattle metro area, Zillow forecasts rents will rise fastest in Shoreline, rising 18.4 percent. Burien and Renton will see increases of 13.5 and 11.7 percent, respectively. (emphasis mine)
If you already live in one of these suburbs and have been thinking about buying a rental property as an investment, now would be a really good time to do that.
I’ve helped countless clients purchase investment properties over the years. But I also bought two investment properties myself in the last few years – one a condo in Seattle’s First Hill and the other a property with four long term rental homes in Taos, NM. So believe me when I say, real estate investing is not for the faint of heart! But it’s not always as risky as you might imagine, either.
If you are considering investing this year or next – especially in the fast-growing suburbs in the Seattle area – here are some of my best tips for you. Stick with these tips and you have the best possible chance of a happy ending:
Tip #1: Put First Things First
Make absolutely sure you’ve covered your own costs before you branch out into investing!
Are your personal and family housing, food, transportation, health insurance, and other essential costs taken care of already? Don’t consider investing if you aren’t personally well covered.
Tip #2: Make Sure It Works With 25% Down
Make sure that the investment property will cash flow if you put 25% down. Even if you have a windfall bonus or an inheritance so you can pay 50% or more down, analyze your expenses at the 25% down level!
How do you calculate this?
You can estimate the rental income by using craigslist or other ads; Zillow has some ideas as well, or your own family members and friends may be able to pinpoint it. I can also put you in touch with a property manager to discuss the potential rent.
You can calculate your costs if you have the following items:
- The loan amount (that 75% remaining balance of the purchase price)
- The interest rate
- Annual property tax
- Hazard insurance premium (your present insurer can give you a good idea)
- Estimated vacancy rate (2 weeks a year? Less? More?)
- Estimated repairs and maintenance
- Property management fee, if you don’t want to manage it yourself
You can do this on your own, and you can probably find calculators online. You can contact me, too, and have me use the investment software I have. We can plug in different figures to quickly get an idea of how upcoming repairs will affect what you can afford to offer as a purchase price, or how depreciation will affect your income tax.
Tip #3: Stick To What You Know
When you look for an investment property, focus on the areas that you already know – your condo building, your neighborhood, or your end of town. You will be best placed to evaluate the rental potential of properties in that area.
Tip #4: Pay Off Your Loan Early
As soon as you get a positive cash flow, apply the extra cash to paying off the investment property loan early. Refinance to a 15 year loan if you can!
Tip #5: Stay In For The Long Haul
Any real estate investing should be done with a very long investment timeline in mind.
Here’s a case where I’ve seen real estate investing work very well: If you buy a property when your child is born, you can probably pay for their full college education when they are 18! (Either by selling the property then or borrowing against your massive equity.)
There is a lot more to consider before investing and I can help talk you through it if you get in touch. I also have plenty of good information (from trusted sources!) that I’m happy to forward to you.
But if you only focus on these 5 things about real estate investments, you’re off to a good start!
