Seattle Property Management Services
The team at SJA Property Management has prepared this page for those of you who are contemplating the purchase of an investment property in the Seattle area, and/or deciding whether or not to manage your property on your own or through a professional Seattle property management company.
Our goal is to provide you with you relevant and useful information that will help guide your decision making, without drowning you in data. Everyone’s’ situations and preferences are slightly different. Quite often the most efficient and effective way to get your questions answered is to talk one-on-one with a Seattle property manager who has years of experience to draw upon. SJA Property Management provides free, no obligation consultation on any and all matters related to real estate and property management. Please don’t hesitate to call us at 425-285-1324 or email firstname.lastname@example.org for a free consultation.
Buying Investment Property in Seattle – Is it a good investment?
There is no safer, long term investment than multi-family real estate in the neighborhoods in and around Seattle. The same can be said for single family investment property, but the quality of the investment, to a much greater extent than with multi-family real estate investments, will be dictated by neighborhood and a variety of other factors. Even in the middle of the worst economic conditions of our lifetime, rents are increasing and occupancy rates are incredibly low. While the stock market and other, more traditional, investments fluctuate based on factors that are generally out of our control, multi-family real estate investment properties are much more stable, understandable and, therefore, controllable. If you own a good property in a decent neighborhood, there is no reason for your asset to underperform financially. Our philosophy at SJA Property Management is that there is no excuse for a vacancy – ever. By limiting vacancy, and reducing our clients’ property-related expenses, we are able to maximize our clients’ return and prove the concept that multi-family real estate investment is currently the best investment available.
What to Consider When Buying Investment Property in Seattle
Once you have made the decision to invest in real estate you must next consider where you are going to buy, how much to spend and what type of property to purchase.
Where to buy in Seattle
Seattle is a large city with many suburbs and neighborhoods. The general rule is that the closer you get to downtown Seattle, the higher the rents are. Higher rents, however, don’t necessarily equate to a property being a great investment. High rents may mean high vacancy and a corresponding high purchase price. SJA Property Management generally recommends buying investment property in proven (in terms of real estate investment) neighborhoods such as Ballard or Magnolia where a good balance is struck between purchase price, rents and vacancy factors. We are also bullish on up-and-coming cities like Bothell which, while not technically in Seattle, are only a short commute to downtown Seattle.
How much should I expect to spend on my real estate investment?
The answer to this question will depend on a number of factors including the amount of money you have for a down payment, the money you have in reserve to cover unforeseen repairs and improvements, and the return and/or cash flow you want or need. If you have very little money on hand or in reserves you are not necessarily precluded from investing in real estate, you just have to put in more effort to uncover the deals. There are still plenty of bank owned, foreclosure and for sale by owner deals out there which can have lower prices and more flexible terms than your standard deal.
If you have cash in hand and would rather not spend your time finding the diamond in the rough then you are in a very good position. Currently, standard investment property financing will require a 20% down payment. So, on a $400,000 investment, you will need to come to the table with $80,000. You may be able to find financing with a lower down payment, but 20% is a good rule of thumb. A recent search of duplex listings in Seattle shows the range in listing price going from $146,300 to $5,060,000. The lower priced listings are, as you would imagine, not in the best parts of town but, on the positive side, are at a price point where the average investor will not be excluded.
SJA Property Management prides itself on finding investment property that is a good fit, both financially and otherwise, for our clients. Investing in property doesn’t need to be a financial “stretch”. If you can’t invest and feel comfortable with your initial investment and the long term potential, then you are better off putting your money elsewhere.
Should I hire a property manager or manage the property myself?
Once you have purchased your rental property you need to decide whether you will manage the property yourself or hire a professional Seattle property management company. The answer lies in personal preference, budget, the amount of time a person has to dedicate him or herself to the issues that may arise and a person’s aversion to risk. A professional property management company like SJA Property Management can relieve a rental property owner of all aspects of managing a property. Tenant screening, lease preparation and signing, rent collection, maintenance handling are just a few of the property management-related issues that are routinely handled by a professional property management company. While it may, for the sake of saving money, appear to make sense to manage your own property, you may find that the trouble is just not worth the extra money. The aggressive marketing campaigns which are implemented by professional property management companies will likely result in your rental property being rented out more quickly than if you attempt to handle it yourself. So the money you think you are saving may be eaten up in one month of unnecessary vacancy.
Seattle is unique and, from a property owner or manager’s standpoint, more difficult to manage as Seattle has passed a tenant friendly set of laws called the Just Cause Eviction Ordinance. The Just Cause Eviction Ordinance gives tenants in Seattle many rights that they do not have in other cities in Washington State. If you plan on managing your own property you should make yourself intimately aware of the provisions of this ordinance as the risks and costs related to non-compliance are substantial.
SJA Property Management understands that many of you, for financial or other reasons, will decide to manage your property on your own. If you are managing your own property and issues arise that you aren’t sure how to handle, please call us. Our team is more than happy to consult with you, free of charge, on whatever property management-related issue you are dealing with. We can be reached at email@example.com or 425.658.1920.