Wednesday, September 28, 2016

Real Estate Marketing Campaign

Q: I have sent out postcards to my list of 600 twice a month every month for the past four months, but I am not finding any deals. Can you help me?

A: Let's take a look at what you are doing, and see where we can improve your response and conversion rates.

First, let's look at your market. Why did you select this market? Are other buyers and investors purchasing property in this market? Is there job growth and a strong economy? Is it close to the employment center? Is the population growing there? Is the neighborhood safe and desirable? What are the demographics? What portion of the residents are owners? renters? If you are wholesaling, do you have cash buyers willing to invest in this market?

Let's say you have done the research of my previous blog, and have decided to invest in one of the hottest zip codes in Washington state.

600 is a good size for a mailing to test your market, medium and message. A good response rate would be 1-2% on each mailing; in this case, that would be 6-12 responses to each mailing. A response might be, "where did you get my contact information? Please remove me from your list!" Another response might be, "Sure, I am interested in selling. What will you give me for my property? I am not going to GIVE it away..." A third response might be, "We just listed this property last week, do you want to see it?" Count each of these as responses, although none of them would qualify as prospects for an investor. Track the number of responses you get.

One of your responses might be "Yes, I was thinking of selling..." and this may or may not be a prospect. What is their motivation for selling? If they are just curious what you would offer, chances are this is not a deal (even though you count this as a response). If they have some financial, medical or other significant motivation, then you have likely just found your first prospect.

Now your challenge will be to convert your prospect into a deal. Remember, it's a numbers game, and you may have to negotiate with several prospects before you are able to finalize a deal. But the more leads you have, the greater your chances of success.

Back to your mailing list: what list did you use to reach your market? is it targeted to the right homeowners to increase the likelihood of the deal you want? For example, if I were looking for a fixer property, I might want to target homeowners who had held their property for 30 years. Or perhaps absentee owners. If I were looking for seller financing, I would want a list of properties with no mortgage. Looking for distressed homeowners? How about targeting recently-divorced owners? And so on...make sure your list matches the properties with the motivation for owners to call you for help.

Now that we have thought about your market, let's consider your medium. Postcards or letters? Handwritten or professionally printed? Bulk rate or pretty stamps? Colorful imagery or plain yellow letters? Test different methods and track your responses.

And finally the message:
What about the wording you are using? Does it compel the reader to action? Does it include multiple ways of contacting you? Can you edit the content to make it more compelling? more personal?

Experiment with different ways of reaching your target audience, and track your results to determine which combination works best for you.

Happy Investing!


Tuesday, September 27, 2016

Low Earners Move Out

Earlier this month, Gene Balk of the Seattle Times reported that low-earners in Seattle were moving out of the city at a faster rate than any other city in the nation. Those households earning less than $35,000 fell by over 13 percent in the past year.

The number of top-income earning households (over $150,000 annual income) increased during this same time frame by almost the same percentage as the decrease for low-income households. Median household income in Seattle now stands at $80,000, according to U.S. census data.

These trends are likely due to a combination of two factors: poorer wage earners moving out of the city to places with a lower cost of living, and some wage earners moving up the economic ladder.

It would be interesting to look at income distribution in areas surrounding Seattle, but the data would likely show higher median incomes the closer a resident gets to the job centers of Seattle and Bellevue.

There are also statistics that show how far people are willing to commute to jobs in Seattle. Not surprisingly, those with higher incomes prefer to live closer to their jobs, while those of lower incomes tend to commute from greater distances.

So what areas are seeing the greatest demand in terms of numbers of housing transactions? We will take a look at that in tomorrow's blog.

Happy Investing!

Monday, September 26, 2016

New Affiliation


Gone Gold!

Dear Blog Readers,

I am proud to announce my affiliation with the largest real estate company in the world with over 100,000 agents in 78 countries and territories and 6800 offices worldwide… CENTURY 21! I am excited to be working with a team of specialists to deliver exceptional service to my investment clients and sellers.

Here is a bit more about me:
Wendy Ceccherelli is a full-time real estate managing broker, investor, developer, and founder of Home Land Investment Properties, Inc. Now affiliated with Century 21 NW, she works with residential and commercial real estate sellers, investors and property owners in Seattle. She is a seller-financing specialist.
As the volunteer membership coordinator for the Real Estate Association of Puget Sound for the past five years, Wendy writes monthly articles for new investors in the REAPS newsletter, oversees membership recruitment and retention efforts, and provides training for new investors to prepare them for their first investments. 
She is a serial entrepreneur, commercial developer and real estate investor. She invests in single family, multifamily and commercial properties in the Seattle area. She also runs her own vacation travel and lifestyle business. Wendy spent over twenty-five years as an executive in both the private sector and in four different municipalities, distributing almost $15 million in government and private funding. 
She has served on over 40 civic boards and commissions in leadership roles, and is experienced in entrepreneurship. In addition, she is a commercially-rated hot air balloon pilot, licensed yoga fitness instructor, a Rotarian, and past President of the Seattle SAKE dragon boat club. This past April she competed as a paddler at Club Crew World Championships in Adelaide Australia.

Below is my new contact information.  Please save or update my contact information and delete an outdated information

Regards,
Wendy Ceccherelli
Investment Broker



Cell: 206.355.1706
Office: 425.250.3301
E-Mail: wendy@c21nwr.com















Friday, September 23, 2016

ADU Policy Changes

PROPOSED POLICY CHANGES

The following is the list of proposed policy changes, when implemented, should encourage the construction of more ADUs and DADUs throughout the city of Seattle.


1. Allow an ADU and DADU on the same lot

Current policy stipulates that a single-family lot can have an ADU or a DADU, but not both. New legislation would allow single-family lots to have an ADU and a DADU.

2. Remove off-street parking requirements

Current regulations require one additional off-street parking space for either an ADU or DADU unless the lot is located in an urban village. New legislation eliminates the off-street parking requirement.

3. Modify the owner occupancy requirement

Current regulations require that the property owner occupy either the main house or the ADU/DADU. New legislation would terminate the requirement 12 months after the final inspection for the building permit. Unfortunately this is only a partial step in the right direction. The owner occupancy requirement is a significant hurdle for construction financing, as the bank cannot rent out the ADU/DADU in the event of a default. This modification may not have much of an impact on production.


4. Reduce the minimum lot size for DADUs

Current regulations stipulate that only lots 4,000 square feet and larger can have DADU’s. New
legislation would reduce the minimum lot size to 3,200 SF. However, all other development standards that regulate the location and scale of DADU’s, such as minimum separation between structures and the maximum lot coverage limit, would remain in effect.

5. Modify the maximum height limit for DADUs

Current regulations determine the maximum height of a DADU based on the width of the lot, with overall height limits set too low to allow conventional roof geometry. New legislation would simplify this standard and slightly increases the maximum height limit up to 2 feet depending on the lot width.

6. Modify the rear yard coverage limit for DADUs

Current regulations limit coverage of a required rear yard to no more than 40 percent. New legislation would allow an additional 20 percent coverage only for one-story DADUs to provide flexibility for property owners who may wish to design a DADU without stairs for mobility or universal design reasons.

7. Modify maximum gross square footage limits

Currently, ADUs are limited to 1,000 square feet and DADUs to 800 square feet. New legislation would maintain a 1,000 square feet limit for ADUs and increase the DADU limit to the same 1,000 square feet. This legislation also removes garage and storage space from counting towards the maximum gross square footage for ADUs and DADUs.

8. Add flexibility for entry door locations to DADUs

Current regulations prohibit entrances to DADUs on the facades facing the nearest side or rear lot lines unless that lot line abuts a public right-of-way. New legislation would allow an entrance on any facade provided that the entrance is no closer than 10 feet to side or rear lot line, unless that lot line abuts a public right-of-way.

9. Allow certain roof features that add interior space

Current regulations allow these features for principal units in single-family zones but are not allowed for DADUs. New legislation would allow certain roof features that accommodate windows and add interior space, such as dormers, clerestories, and skylights


More on accessory dwelling units in tomorrow's blog! Stay tuned!

Happy Investing!

Today's blog courtesy of David Taber, Neiman Taber Architects


Thursday, September 22, 2016

ADU Financing

FINANCING

If you’re unable to finance your accessory dwelling project with cash savings, the following conditional loan types are worth exploring and may be viable options depending on your current financial situation. Some lenders are beginning to catch on but in general, the industry remains unfamiliar with the added value ADUs and DADUs can bring to your property, thus making financing more arduous than necessary.

Cash-out refinancing – Refinance your existing loan for more than you owe, taking out the difference in cash

Home equity loan & Home equity line of credit (HELOC) – Also referred to as a second mortgage, both types allow you to borrow money using your home’s equity as collateral

Renovation financing / FHA 203(k) – Combines a construction loan with your home mortgage


REFERENCES
If you’re interested in more information on accessory dwelling units in Seattle, check out the following:

Seattle Department of Construction and Inspections

Additional information on permitting, requirements, guides and reports for both ADUs and DADUs

Accessory Dwellings

A Portland based one stop internet source for all things ADU. Some information may not be directly applicable to Seattle, but we’ve found them to be an invaluable reference nonetheless.

SUMMARY

Seattle's existing neighborhoods are one of the largest untapped resources available for increasing affordable housing stock. By no means will this typology single-handedly solve our housing shortage, but it's an easy and beneficial step in the right direction that will have little or no impact on the scale and character of our neighborhoods. You only need to look at the track records in Vancouver and Portland to see any concerns about changing the character of our neighborhoods have proven to be unfounded. In our pursuit of livability, affordability, community and access to housing for all, we look forward to welcoming more ADU and DADU projects into our community.

Happy Investing!

Today's blog courtesy of David Taber, Neiman Taber Architects

Wednesday, September 21, 2016

ADUs vs DADUs

THE DIFFERENCES BETWEEN ADUs AND DADUs

If you’re thinking about building an ADU or DADU, there are several factors to consider. As noted above, both share many advantages, but the following are additional issues to consider:

Accessory Dwelling Unit

§ Can provide rental income

§ The space and building systems already exists - construction expense is greatly reduced

§ Does not impact scale or character of neighborhood and often goes unnoticed

§ Does not impact open space of property

§ Unit can often be directly connected to house if so desired (family members)

§ Can be a quick return investment

§ Since the unit is attached, sounds will likely be heard regardless of sound-proofing efforts

§ Privacy. You’ll likely be sharing some exterior spaces and possibly even some interior


Detached Accessory Dwelling Units

§ Can provide rental income

§ Increased privacy and no shared walls and floors/ceiling

§ Clear boundaries can be delineated between units

§ Cost. Building a DADU is significantly more costly per square foot than building a house

§ Takes away from yard and open space

§ Potential to impact neighbors open space and privacy

LESSONS LEARNED

Below are "before" and "after" floor plans of an ADU we recently completed. As with most ADUs we’ve designed, the basement was finished space and only required minor interior renovations. A small, compact kitchen was added along with a new closet for a stacked washer/dryer, and sound attenuation and fire separation was added to adjoining house walls and ceilings. In addition, access to an electric sub-panel and thermostat was added for independent control of the building systems within the unit. And the best part - no exterior work was required. This ADU has 485 SF of rentable space, will be used as a long term rental, rents for $1,200 / month and cost $35,000 which included all project costs.



DADUs are wonderful - who doesn't love a tiny house (?!) but ADUs are typically a bigger bang for the buck. Based on the ADU project we've designed, returns on investments have ranged from 2 to 4 years.

How to finance? We'll be exploring this topic in our next blog. Stay tuned!

Happy Investing!

Today's blog courtesy of David Taber, Neiman Taber Architects


Tuesday, September 20, 2016

Increasing Affordable Housing

WHY ADUs and DADUs ARE A GOOD THING

For the City

They increase affordable rental housing, utilize existing house stock without compromising the scale and character of neighborhoods, encourage better housing maintenance and neighborhood stability, reduce sprawl and environmental footprint, and are viable alternative to larger scale housing projects

For the Homeowner

They provide rental income, offer a private living unit for family members or friends, create aging in place opportunities and increase property values

For the Renters

They offers affordable rent and access to amenities in single family neighborhoods such as privacy, quieter environment and less traffic congestion

More in tomorrow's blog about the policy changes proposed by the City of Seattle. Stay tuned!

Happy Investing!

Today's blog courtesy of David Taber, Neiman Taber Architects