Auburn

We have seen that in January, 2009 there were approx 180 single-family residential properties for sale below $250,000.  Some of these Auburn homes would be great to purchase as rental properties.  There is always a demand for reasonably priced rentals that are in good locations such as Auburn, WA.   Auburn has public transportation such as buses, and also is fortunate to have the Auburn Sounder Station and train to commute to other locations in Kent, Seattle, and Tacoma and other places along the way.  Also, there is easy freeway access to Hwy 18, Hwy 167, and I-5.  For employment, there are lots of business located right in Auburn in the industrial area of Auburn, as well as the downtown areas of Auburn, and other surrounding cities that employ many people.  All of these amenities make for a great location for owning a rental property.

However, before purchasing an Auburn rental property, an investor must do his/her homework and consult with the following professionals who can advise the potential investor on his/her specific situation.  They include the investor’s financial adviser, accountant, lawyer, Realtor and mortgage professional.  They each have areas of expertise that are crucial in making the proper decisions in purchasing a rental property in Auburn.

The advantage of rental real estate is the fact that when you own rental real estate, you own a tangible asset over which you have a great amount of control, as opposed to ownership of stocks, bonds, mutual funds, etc.  The disadvantage is that you have liability, so you must make sure that the Auburn property you are renting out meets all government standards.  Also, there will be unexpected expenses for repairs, and there will be vacancies from time to time without the desired monthly income being generated.

FHA can be a great way for first time home buyers to get into the investor market when they are buying a 2-4 unit home in Auburn.  The buyer must intend on residing in one of the units and the mortgage will be treated as an “owner occupied” transaction.  You will have upfront and monthly mortgage insurance and can buy with as little as 3.5% down payment.  Currently there are 27 properties in Auburn that are 2-4 multifamily units.

Seasoned investors know that obtaining a mortgage for a non-owner occupied property is much different than buying one in which you will reside.  For instance qualifying is tougher, down payments are larger, and mortgage interest rates are higher since it is a riskier transaction for the lender.

Once the investor has purchased the home in Auburn, obtained the loan, and then closed on the rental property, the investor now has the next challenge ahead of him/her, which is renting the property.  If you as the investor decide to manage the property, then pay yourself for being the property manager.  Property management costs need to be accounted for as operations costs.

Auburn real estate prices are down and interest rates are still at an all time low.  Renting out homes is a hot choice in today’s real estate investment market.  There are many homes and 2-4 unit residences available for purchase in the Auburn area.  Let me help you find the investment property that will work for you.  Call me today for a list of these Auburn investment properties.