Edward and Jackie are friends of mine from LA. When they came to me with dreams of securing their first real estate investment property, I was very excited for them. I was also honored that they thought of me, as I always appreciate the opportunity to help guide my clients in making such an important decision.
Mutli-family properties offer the potential to generate solid cash flow while the property appreciates. Working closely with Living Room’s property management team, we would send the listings to them to analyze the potential rental income that could be expected. This helped give them a realistic expectation of what they could expect to fetch for monthly rents, which in turn helped us have a solid understanding of the income potential on the property. We were able to isolate down what the Capitalization rates would be (basically, an amount expressed as a percentage based on the property asset value, divided by the net operating income, that the owner can expect an annual return on) to make sure it’s a sound investment in the near term and long term.
We found a duplex just outside of Parkrose with low rents with upside potential, that fit the style of building that they prefer. Nice, big 3 bedroom, 2 1/2 bath units close to the Columbia River with views of Mt. St. Helens from the master bedrooms. They beat out a cash offer with an over asking offer right off the bat, and a quick expiration. Even with that cash offer looming in the background, we negotiated a strong repair addendum to address concerns, and stayed in close contact with all parties as the appraisal process dragged on (the appraisal took over 3 weeks to complete). When it eventually came in, we appraised at the full value of the offer price.
In the end, all parties were feeling the positive effects of working cooperatively to get to the end result we all desired. Congratulations Edward and Jackie, I’m so happy for you both and your new duplex in Portland!