$100,000, Seems this is the magical price that buyers think will get a good deal. Without fail, I receive numerous calls for buyers looking for a home and even better, a home near the water or with a water view for $100,000. I suppose this would be an easy assumption based on the national news that weekly reports the fall of real estate prices in the U.S. and an increase of foreclosures. But, what’s happening on a national level is not what is happening here in Bellingham, WA. Real estate is hyper-local meaning each community has its own market that can and will differentiate from the national market. Another way to put it, what $100,000 will buy in say Phoenix, AZ or Detroit, MI is VERY different than what it will buy here in Bellingham,WA. Also, keep in mind that Bellingham is a waterfront city as well as a few of her suburbs (Blaine/Birch Bay). Waterfront or water view real estate, being in high demand, is pricey and therefore will hold its value.

Let’s take a look at what this price will fetch in a few markets across the nation:

Phoenix, AZ - a large variety to  choose from  (Trulia median sales price  is $109,000)
Los Angeles- will buy you a 2B/1B 860 sq.ft home in South LA or Condo ( Trulia median sales price $296,000)
Miami- a studio condo, 490 sq.ft or small home (Trulia median sales price $161,000)
Detroit- 3+ B/2+ B brand new home on large lot ( Trulia median sales price $62,000)
Tulsa, OK - Tulsa offers a large number of homes to choose from ( Trulia median sales price $198,000)

Here is a sampling of what $100,000 property looks like in Bellingham, WA:

Most of these are small 1-2Bed/1Bath and in need of repair. The one on the very right is a 3B but is on a very busy road here in Bellingham.  If you are serious about investing or purchasing property and are “handy” and know a thing or two about making repairs, then yes, I can find you something.   There are many a “fixer upper” in this price range. Or if you don’t want to be near the city and prefer to be way out in the county like Deming or Maple Falls, I know I can find you something here too.  But if you are looking for a rock bottom deal on a well constructed and well maintained home within the Metropolitan area of Bellingham or waterfront or water view, you’re going to have to up the ante.  The average price range for a modest home in Bellingham  ( 3B/2b 1500-2000 sq.ft) is 276,600..

The average price range for a waterfront home in Bellingham is $775,000.

And at $255,000 , this is one of Bellingham’s best waterfront buys.  It is out of the city limits, and needs much work.  What we call a ” tear down”.

So as you can see, $100,000 depends greatly on location and market.

If you would like more information on Bellingham Homes for Sale, Bellingham’s real estate market or if you are considering selling your home and would like additional information on what your property’s value is, contact me  direct at 360-303-3898.

I look forward to helping you whether you are looking for investment property or a residence for yourself.

I had trouble connecting to the internet and was able to find a wi-fi hotspot at the Blackberry House Café. When I arrived with my client the barista told us that they would be closing in 10 minutes however, she said we were welcome to stay, order a coffee and could continue to use the wi-fi service even after closing. I ended up staying for almost an hour without any interruption. Today, friendly customer service  is so hard to find these days. I was so thankful because this kind gesture allowed me to spend more time with my client, while providing us with additional time to search for directions to selected properties.

So thank you again Blackberry House Café for your hospitality, for your wi-fi connection and a great cup of coffee!

If you have questions or an interest in Bellingham/Blaine/Birch Bay real estate please give me a shout. The best way to reach Chuck is directly at 360.540.6357. Email Chuck at Chuck.Burkhart@eXpRealty.com

[srpmap lat="48.9937759" lng="-122.74938800000001"]

Blackberry House Cafe’

321 H Street
Blaine, WA 98230-4109

[/srpmap]

I went to Western Washington University, here in Bellingham, so I will use it as an example, though the numbers would likely look quite similar in just about any college town. Rates per person at Western’s dorms run roughly $500 (3 kids in a room) to $800+ (single occupancy) per month, NOT including food expenses.  Rental rates anywhere near campus run about $400-600 a month per room, depending on the number of rooms.  Studios and 1-bedrooms are commonly $700-900/month, whereas you might find a decent  3-bedroom for $1400.   Let’s be conservative and say it’s about $600/month on average, per room. Over 4 years (48 months) that’s almost $30,000(!) that you will NEVER get back.  As Everett Dirksen famously said,“ A billion here, a billion there…pretty soon you’re talking about real money!”

Consider this:  Right now, you can buy a 1-bedroom, 600 square foot condo, built in 2006, less than a half-mile from Western Washington University, for $140k.  With 20% down at 6% interest, the monthly payment, which includes taxes, insurance, and HOA dues (W/S/G) comes to about $925, leaving only electricity and cable for expenses.  Sounds like kind of a lot, doesn’t it? Let’s take a closer look.

• Similar units in this building are currently renting for between $725 and $800.

• You can write off some (maybe  all) of your interest payments , giving you roughly 25% back at tax time, depending on your bracket, making the effective monthly expense closer to $700. Make sure to talk to your accountant about this and other creative write-offs you might find…

• As an owner, your monthly expenses remain fixed over time.  According to Cory Walken, a colleague who studies rent growth in the area, rents near Western have increased at an average of about 6% per year, over the past 5 years.  Assuming that trend were to continue, the monthly rent on that same unit would go up  to almost $900-$1000 by the 4th year of your student’s education. Over 4 years, that would cost you between $38000-$42000 in rent! Gone, flushed….never to be seen again…

• Don’t forget about appreciation! Even in these tough times, most analysts are expecting the market to have corrected itself in the next couple of years, meaning there is a good chance the value of your investment will begin to increase during the 4-5 years that your student will live there.  That’s right, you might even MAKE money on this thing! Worst case, you can always hang onto it to make sure the kid doesn’t try to move back in with you after college…

This is just one example, of course.  There  are several other condo opportunities I can point you toward.  There are also houses and duplexes, etc… The numbers can look even better if you buy something with more rooms. Then, you can collect $500-$700/month of OTHER PEOPLE’S money! That ‘s the best kind of money, after all…

If you’d like to look more seriously at this type of investment, keep in mind that there are all kinds of different programs available, requiring anywhere from 3.5% to 20% down.  You can buy as an investment property, as a second home for yourself, or possibly as a first-home for the kid, which means eligibility for the $8000 first-time buyer tax credit. Each of these options has it’s own credit and income requirements, as well as unique tax implications.  Again, I would suggest consulting your accountant, as well as a mortgage professional, to make sure you understand clearly these particular details. You can talk to me if you want to know where to find these properties.

I can be reached on my cell at 206.883.6668, or by email at rob.leroy@exprealty.com

This post simultaneously published by Rob LeRoy at theRealEstateNovelist.com

Rob LeRoy is a Seattle real estate agent and social media marketing coach with eXp Realty.