Investor · Denver, CO · Member since 2015 · 492 posts · 267 votes
Ok, so I sold my investment house in Commerce City, Colorado.
Denver area, for out of state people.
We bought it 2 1/2 years ago for $120,000
Mortgage was aprx $900/month
Rented it out for $1,900/month
Listed for $225,000
Sold for $215,000!
Now to send all this money down to Pueblo, co to invest in the #15 top county in America... According to BP. Only one in colorado in the top 25.
I already own 8 properties down there... and they are all cashflowing Great
Happy Investing Everyone!
@Matt M. I've worked with almost a dozen clients this year moving into the Pueblo area. Some leaving the sprawl from the Denver area and some just liking the area. I recently sold a geodome to a couple of guys moving here after selling a successful coffee business in San Antonio. I think the low cost of living, still the very much small town feel, the Riverwalk area and the summer activity around it (Pueblo comes together to party) is such a huge draw , even though it doesn't compare to San Antonio.
There are not a ton of fix and flip opportunities with the usual 70% ARV but they do come up. Their is a great opportunity to buy and hold as noted in the increased rents. Many of the homes that @Robert Herrera mention in the $30-100k price range are 1900-1950 built homes. Structural integrity is the biggest issue with these older homes and of course desperately needing updating. There is approximately 1900 homes in the Eilers Superfund area where loans simply aren't happening. That area presents a great buy and hold opportunity. 25% of our mls inventory is vacant homes. It's definitely a sellers market at the moment, new construction is picking up and hopefully if it continues it will relieve the inventory pressure.
There really isn't much to discuss about marijuana that you probably don't already know being from the Denver area. There is going to be 4 dispensaries in the city.
Great deal job on the deal @Robert Herrera. I've been interested in Pueblo since I live in Colorado Springs, but not familiar at all with the area. How did you get so confident in the properties you did end up purchasing in Pueblo? Any good realtors you could refer me to?
Mitzmichael Sumilang thanks for the shout out. I used to live in Pueblo. I know the area very well. It is not the same place I used to live in anymore. Don't get me wrong, it has some familiarity to it, but with soo many people moving there, cause they can't afford Denver and Colorado Springs, it's become a hot spot for rentals. Here is why I can invest confidently there... it's called the STATE WIDE MANDATORY MINIMUM WAGE OF
15/hr by 2020.
When everyone is used to getting paid $8/9$/hr and now they are going to be getting paid nearly Double... well there are already not enough rentals. Rents are going to really high over the next 3 years. This is going to drive a surge of investors to the area in addition to more regular home buyers. This will cause the whole market to shift up, and equity chasers will be winning here. Prices going to catch up to springs.
You shouldn't rely on Real Estate agents to find you deals. They don't know what investors really need. They also give a lot of bad advice to investors as they don't know what they are talking about, but want to sound informed in front of the client.
I would recommend knowing what you want, then contact my realtor to get you looking into the ones you specifically want to see, via your specifications. As an investor, I believe you need a fast agent. One who can find what you want, get you in quickly to see it, and can write up an offer fast. The rest is the investors jobs.
It's not the investment that is Risky, it's the Investor. If you are hoping an agent knows how to be an investor, you are asking a very Risky Person.
Houses can be bought between $50k-$100k right now, all over town.
I feel they may come close to doubling by 2021.
My warning, buy NOW! If you wait till everyone jumps in over the next few years, you will be LATE TO THE PARTY.
Susanna Carbaugh thanks for the shout out.
@Robert Herrera I really appreciate all the insight. I do see properties selling for $30k down there, but should I stay away from those properties? I'm not exactly sure what the desirable areas are?
Mitzmichael Sumilang I would only buy one that has all the utilities working and a good roof, unless you have a few extra dollars to spend to fix that, and it's not too major. If it works, and isn't falling over, pick it up. I try and stay away from anything 4th Ave and below on the East Side, Near the White Horse bar. Anywhere else is pretty much a better option then that specific row of blocks. Further east and under 4th Or anywhere over 8th st, I would buy if you find something there. Everywhere else is pretty much a go for me. I own 4 properties on the east side of town currently.
@Robert Herrera thanks for that tip. I'll keep that in mind when researching the area. I'm currently in the market for a multi-unit to move into in the Springs area, but will refi/heloc to start looking at properties in Pueblo. I heard there are 3 universities in Pueblo. Any insight on which one to target around?
@Robert Herrera - With all due respect, I must take exception with two of your assertions. First, there's the blanket statement that REALTORS don't know investment real estate. Where it's true the average REALTOR has no need to, there are actually quite a few REALTORS who know investment real estate very well and do outstanding work for investors, not just yours.
Second, if it is true a rising tide lifts all ships, any statewide increase in minimum wage will lift all markets equally, not just Pueblo. Now, Pueblo has shown a 64% increase in median prices since 2010...not too shabby! However, where I strongly doubt a 200% increase in four I also hope you're right, as many are cashing on on what appear to be irresistible cash flow numbers. I say appear to be because, where every one needs to live somewhere, assets in the lower price points may also carry higher turn costs.
Norberto Villanueva Thank you for your input on this situation. I see you post replays from time to time and you seem to know a few things about investing. I will admit I put a blanket statement, and you are right, there are Some agents who also invest, and know what they are talking about. I just feel they are few and far between. As an investor, I should be able to analyze deals and use an agent to help give me th data I need.
As far as the tide, yes. The thing is, people in the upper city's already get paid more. The impact will hit harder in Pueblo. Also the price point is low enough that beginners can also join the market before they can't afford to invest.
Thanks, I'll be hitting 15 properties there by this weekend. I'm about to pick up a duplex. I'm actually headed to Pueblo From Denver tomorrow to look at a couple properties.
Matt M. Low acquisition cost. Typically $30k-$100k+ depends on what you want. 30mins from Springs, 1 1/2hr from Denver.
Rents going up. No problem beating the 1%rule.
Minimum wage increase from $8hr to $12hr. This will cause rents to go up more and make it more appealing to investors. This should cause the prices to go up.
Springs is in a bidding war like Denver used to be. It will trickle down to Pueblo next.
Marijuana dispensaries are not allowed in the city of Pueblo. The county and Pueblo West has them. Pueblo to allow them in 2019.
@Matt M. I've worked with almost a dozen clients this year moving into the Pueblo area. Some leaving the sprawl from the Denver area and some just liking the area. I recently sold a geodome to a couple of guys moving here after selling a successful coffee business in San Antonio. I think the low cost of living, still the very much small town feel, the Riverwalk area and the summer activity around it (Pueblo comes together to party) is such a huge draw , even though it doesn't compare to San Antonio.
There are not a ton of fix and flip opportunities with the usual 70% ARV but they do come up. Their is a great opportunity to buy and hold as noted in the increased rents. Many of the homes that @Robert Herrera mention in the $30-100k price range are 1900-1950 built homes. Structural integrity is the biggest issue with these older homes and of course desperately needing updating. There is approximately 1900 homes in the Eilers Superfund area where loans simply aren't happening. That area presents a great buy and hold opportunity. 25% of our mls inventory is vacant homes. It's definitely a sellers market at the moment, new construction is picking up and hopefully if it continues it will relieve the inventory pressure.
There really isn't much to discuss about marijuana that you probably don't already know being from the Denver area. There is going to be 4 dispensaries in the city.
@Robert Herrera I love this thread shows how powerful and simple real estate can be. I am looking to dump half a million or so into my local region. How would you do it make half that money rentals then the other half flips to tenants to do rent to own? I am trying to figure it out and meet a bigger pocket member!
I'm in the same boat as @Matt M. I fail to see the massive draw to Pueblo. There aren't any large manufacturing facilities or job magnets moving there, their local city council leaves a lot to be desired, and the state-wide minimum wage is also going to put people out of work, so I fail to see the desire just because properties are cheap.
@Luke Miller It took me a second to digest the info of pros and cons of Pueblo. At first, I definitely agreed with @Robert Herrera that a 20% increase in minimum wage in the near future and then almost another 40% increase to $15/hour would definitely have a greater impact on a community/city where the average wage is much lower. But after reading Lucas' point, I also agree that many people will lose their jobs or be cut down to part time due to such a drastic minimum wage hike in an already depressed local economy.
I go boating frequently in Pueblo and have seen the positive impact that marijuana has had on the Pueblo West commercial real estate. But as far as rentals go in the heart of Pueblo, I'm not quite sure. What does the local Business Journal say? Is the city expecting new growth? The city was always severly reliant on the local steel mill and that business has seemed to decline year after year... And again, the minimum wage hike may hurt more than help.
Anyways, interesting stuff, and I just wanted to chime in! I hope it does rebound, but I'd like to see some indications of JOB growth - not just minimum wage.
Also the steel mill has been down for years. Operating on a skeleton crew
They just fired it back up when Trump announced all pipelines in America must be made by American steel. If you ever visited the area, you would see the growth first hand. New businesses popping up everywhere. Pueblo West became its own city by how fast and big they are growing. You know what, don't invest here. The inventory is starting to get low and I'm really don't feel like competing with more investors there.