Colorado spring. multifamily.

15 Replies

I have 14 units of my own here in Washington state but a son that I want to get started with in Colorado Springs. Any advice on the market and availability of deals down there? Thank you.

This year we have been a part of purchasing four Fourplexes whether for ourselves or for clients of ours, as we are also in Property Management. All currently cash flow very well and all needed quite a bit of work even with them being fully rented. Rents are surprising me currently with what people are paying to stay in these units, but that is a good thing. The options are very slim right now and over this last year, doesn't look to change much through 2016.

Best of luck in your new adventure with your son and if there is anything that I can do to help, just let me know.

@Erik Gray , below is my loose analysis of the Co Springs market that I posted in another thread a few days ago. By no means an expert, but this is what I have observed:

The rental market here has been going up quite a bit lately. Finding small multifamily properties that perform at a 9-10 Cap is totally doable, especially if you are able to identify solid value-add deals. Denver has seen some pretty meteoric rises in housing and rental prices and that seems like it ripples into the nearby CS market. Not sure how appreciation has impacted the Springs lately, but I'm sure as with anywhere it will vary with your market segment.

Overall it seems to be a pretty strong rental community though due to the very large number of military bases. The Air Force recently announced plans to increase force size for the first time in 6 years, in addition to the recent increase in housing allowance for military members, both of which I expect will also have some positive effects on the market here.

@Bryan Rodriguez , @Tyrell Anderson , @Brendan M. :

How do you guys go about finding 2/3/4-plexes in the Springs? MLS ? Seems like there isn't a whole lot there, and even some iffy deals go really fast.

As a buyer, do you work with an agent to find properties or do the searching yourself ?

Do you guys have any experience/insights with soliciting property owners directly ?

My goal is to buy and owner-occupy a 4-plex with FHA loan in the next 3-6 months. Right now I'm scoping out neighborhoods that a) cash flow and b) are someplace I could stand to live for a year. My idea is to generate a list of owners of candidate properties and mail them. Seems like in the Springs, 4plexes are mostly clumped into little "plex ghettos". Makes them easy to find, but not always the most lovely areas...

Anyway, I've got tons of things I'd like to learn and chat about with a real, live Springian fourplex owner.  Do you guys go to any of the meetups ?

@Jeff S. I think if you watch the market closely for a long enough period of time you'll see plenty of opportunity exists, especially if you look for value-add opportunities. When I was on the lookout for my first 4plex, I had the same concerns, that most of the 4plexes I was seeing looked like they were in sketchy neighborhoods. But that's just the nature of 4plexes - they will correlate strongly with a specific income class.

If you are really interested in house hacking, you'll have to accept that fact that the neighborhood you're most likely to find a 4plex will be a lot different than your standard middle-class SFH cul-de-sac. But once you spend some time in a lot of these neighborhoods, it's easy to see it's not as bad as you thought it was at first either. There are, of course, neighborhoods you should definitely stay out of, so use your best judgment.

As for meet-ups, I love to attend as many as I can when I'm in town but don't expect to be back for another month or two. Feel free to get in touch if you have any questions.

Originally posted by @Brendan M. :

@Jeff S. I think if you watch the market closely for a long enough period of time you'll see plenty of opportunity exists, especially if you look for value-add opportunities. When I was on the lookout for my first 4plex, I had the same concerns, that most of the 4plexes I was seeing looked like they were in sketchy neighborhoods. But that's just the nature of 4plexes - they will correlate strongly with a specific income class.

If you are really interested in house hacking, you'll have to accept that fact that the neighborhood you're most likely to find a 4plex will be a lot different than your standard middle-class SFH cul-de-sac. But once you spend some time in a lot of these neighborhoods, it's easy to see it's not as bad as you thought it was at first either. There are, of course, neighborhoods you should definitely stay out of, so use your best judgment.

It's funny.  I live in Old Colorado City, and there's definitely some very sketchy aspects to the area.  VERY broad demographic mix - from homeless, meth-addicted prostitutes on up. At first I had some doubts, but I really LOVE it here. 

OTOH, one of the first MFH's I checked out on google street view (Loomis Ave, by Ft. Carson) had a burnt-out house next door and 2 active cop cars on the block.  Not going there....

Some great info here. I've been scouting for multifamilys in Colorado Springs as well. Still trying to nail down my approach on REI. Most important I think is I'm starting to see some names that pop up in here over and over!

I've now owned 5 fourplexes in Colorado Springs and I found all of them by sending post cards to owners of properties in areas I was interested in. You can create and send them easily using usps.com. You can get a list of multifamily owners from a title company. Last I did it they were charging $5 for the service. Tell them which zip codes you are interested in and they can send you a spreadsheet you can upload to the post office web site to create your cards.

Also, visit trulia.com and put in the address of a fourplex you're interested in. Scroll down the page until you come to the crime map. You'll quickly discover areas you'd want to invest in and others you wouldn't want to go near.

Hey @Les Goss ,

Great advice! I am undertaking your marketing strategy and have acquired a list of multifamily's from the title company and was wondering how you uploaded the list to the post office website to create your postcards? Thanks for the great tip and any other information! 

Daniel