Category Archives: rentals

Increasing Net Worth Through Real Estate

The majority of American households own a primary residence, but did you know that homeowners have, in general, more net worth than their renter counterparts?

The National Association of REALTORS® tracks the relationship between renting, homeownership, and net worth. Every three years the Federal Reserve conducts their Survey of Consumer Finances to collect the data which is then analyzed.  In the most recent survey completed in 2016, the data showed that the median homeowners’ net worth ($231,000) was more than ti44mes that of the median renter ($5,200).

Equity in a home (the difference between what is owed on the mortgage and what the home may sell for in today’s market) is one of the biggest drivers of net worth.  When a renter pays rent, no equity is created for the renter – that goes straight to the landlord’s pocket! But when someone has purchased a home that monthly payment usually goes to paying down the loan, creating equity. The homeowner also receives the benefit of property appreciation – and if they don’t refinance, the principal and interest payment stays the same (assuming a fixed rate loan) whereas a renter may be faced with annual rent increases.

Of course, there are pros and cons to either renting or purchasing a home, and these should be considered before jumping into a home purchase. Appreciation and rental rates change from area to area and even neighborhood to neighborhood!

I would be happy to show you the possibilities. Please give me a call: (206) 790-0081 or send an email to Jamie@JamieFlaxman.com.

Rental Properties in Seattle

Over the past several years, Seattle has been introducing new rules and regulations about rental properties. The goal of these new rules is good – to protect tenants, both their civil rights and their physical health and safety.

The first rule, which went into effect several years ago, is that all rental properties in the city must be registered with the City. As part of this, all properties must be inspected by a city approved inspector to ensure the property is safe. You can learn more at http://www.seattle.gov/DPD/codesrules/licensingregistration/RRIO/aboutrrio/.

More recently, Seattle passed two new rules that went into effect on January 1st. The goal of these new rules to assist renters in finding affordable housing and to ensure there is no discrimination in choosing renters.

The first is the “first come, first served” policy that says that you must accept the first qualified applicant for your rental property. Property owners have many questions on how the first come, first served policy is to be implemented – see this article for more information.

The second new rule has to do with limits on deposits and fees for rentals, including that a renter may pay the deposits over time. See this article for more information.

I have talked with several rental property owners over the past couple weeks, and I have heard a couple themes. One is that they don’t understand how to implement these new regulations. I don’t blame them for that – the rules are complex and implementation steps are not clear.

The second theme I’ve heard is that rental property owners are thinking it may be time to sell their Seattle properties and/or for new properties they purchase, go outside of the City limits. Again, I think these are reasonable responses. Not sure if this was the intent of the City as all this might do is reduce the number of rental properties in Seattle; the flip side of that is that a lot of rental property owners decide to sell, we may see more housing inventory in the “for sale” market.

Questions or want more information, just give me a call/text at (206) 790-0081 or email.