Invest In Portland Real Estate

Invest In Portland Real Estate

If you have been considering buying a rental home or small plex, Portland Oregon might be just "the" place, and here is why.  The Portland metro area has long been a top "move to" area, with moving companies constantly rating the area in the top inbound destinations year after year.  Our geographic location just north of California with its 40m people and California's crazy house prices also causes a constant inbound migration.  On top of this, we have a vibrant young and well educated workforce, and we also are one of the top areas in the USA for job growth.  Add to this we have an urban growth boundary which prevents large scale home building and causes relatively constant price increases for homes and rents.  

Our current metro area poulation is just under 2.5 million and projections for population increase are for up to another 500,000 plus people to move here in the next 18 years, and to 3.5m by 2060. All of this combines to create a perpetually low vacancy rate.  Whether you live locally, or are an out of state investor, you should consider our area for stable, long term growth.  Please look at the charts below, check out one of the downloadable PDF pro-formas at the bottom and even see some sample homes with the links below.

This chart shows our average sales price for the metro area 1992-2016. At the same time our land constraints have caused rents to mostly always increase making great returns for investors, especially when considering the population increases above. Remember, owning rentals is IDEAL. "I" for INCOME from monthly rents pays most of theexpenses and "D" stands for DEPRECIATION where the government allows us todepreciate the home over 27.5 years for many investors.  "E" stands for EQUITY BUILDUP because your tenants are paying off the loan and "A" stands for APPRECIATION, the home over time goes up in value. Last, "L" stands for LEVERAGE, you can buy a rental for as little as 20% down of your own cash.

Add to that continual over time increases in rent and you can see why so many people use rental homes as a part of their retirement planning both long and short range. Check with your tax advisor to find out how owning rental homes can benefit you.

As some examples, THIS LINK will show you all 2-4 plexes available in the area. For single family detached homes, THIS LINK will take you too good single family homes for rentals in the Beaverton area. THIS LINK has similar homes in the Tigard, Tualatin/Sherwood areas and THIS LINK shows homes in SE Portland and THIS for NE and North Portland. Last, THIS LINK has Milwaukie/Gladstone and THIS Gresham area.  For purposes of finding rentals that "make sense" these homes are all under $400,000, 3 or more bedrooms, and 2 or more bathrooms.

Feel free to download a full six page sample report showing all the projections and  assumptions for purchasing a four plex.  This six page PDF report is for a fictional $500,000 four plex in Beaverton, Oregon and assumes an appreciation rate of 5% (Metro Portland has been much more over the years), and nominal rent increases of only 3% per year. Its interesting to see how by putting $125k in cash now and using these assumptions that in 20 years your net profit could be over $1,200,000!

Cant swing the $125,000? HERE is another sample report, this one for a $300,000 single family home. This requires only $75,000 down (25%) and uses the same assumptions (5% annual appreciation, 3% increase in rents).  Note, in 2014-2016 the rent increases in Portland metro were two times this amount and projections are for continued growth both in rents and appreciation due to the anticipated population increase, as well as the urban growth boundary preventing any large scale home building in the area.  In both cases I even calculated in the costs of hiring a property manager to take care of the renting, collecting rents and coordinating the maintainance to make your investment hassle free.  However you can save that fee by taking care of the home yourself.

"90% of all millionaires become so through owning real estate".  Andrew Carnegie said this back in the 1800's and this pretty much stands true today.  

Bottom line:  If you are considering purchasing a rental home in an area with strong appreciation potential, you need to consider doing so in the Portland, Oregon metropolitan area. We at The Rob Levy Team have been selling homes and small investment properties at a high level since 1988 and we are constantly ranked as one of the top agents in the Portland area.  We own rentals, and we understand what to look for regarding the intracacies of buying and owning rental homes.  There are many laws regarding tenants rights so we can point you towards good property managers or towards classses so you can do it yourself.  If you currently own a rental which you will be selling to buy your Portland rental, we have worked for many years with Beutler Exchange, a top local 1031 exchange company so you can in most cases defer your capital gain and roll it into the new rental.  If you want to better understand 1031 tax exchanges for when you sell your rental you can do so here. We'd be happy to help you find and purchase the ideal rental tailored to your needs; whether it be your first rental, or one of many. Please contact Rob today for more information at (503) 906-1444 or [email protected]