Castle Rock- highest best use for House with View STR?

Question

Hello all,

I am trying to figure out if this custom home on the hill in Castle Rock Co is a good investment. The best strategy I see for it is as a Luxury STR, I’m just not sure the market supports this.

James Carlson · Answer

@AJ Wong mentioned STR laws. Are you actually in the town of Castle Rock? Or are you in unincorporated Douglas County. Castle Rock actually doesn't regulate Airbnb or shirt term rentals, so you're good there (as long as you're not in an HOA). And Douglas County recently pass an ordinance allowing STRs, so you're actually good there. Either way, you'd need to obtain a license.

Have you run the numbers? Through AirDNA or Rabbu? The Denver STR market ain't bad, but just like most places in the U.S. right now, if you're buying at today's interest rates and with the revenues still lower than in 2021/2022, they're tougher to get right. Any investors/ buyers of mine looking for a vacation rental in Colorado tens to have dual goals -- investment and personal use. And I advise then to have a longer horizon.

Good luck.

AJ Wong · Answer

HI Michael, I'm a huge fan of all things Colorado but I've heard STR restrictions have been tightening..AirDNA and local PM would be a good projection and analysis resource. I've helped several CO based investors explore luxury STR's here on the OR Coast, there are still very strong COC & ROI opportunities. Definitely check in with @Joseph Chiofalo for Jumbo second home and investor loan products, we just had an unbeatable rate and appraisal waiver here on the coast. DM me with any STR related questions or help with analysis. Good luck!

Michael C. · Answer

@James Carlson

Hello everyone-

I guess when I hit the back button to edit the post it made a complete new one. Not sure how to fix that.

Here is the pertinent information in my other post.

https://www.biggerpockets.com/forums/530/topics/1196499-cast...

Joseph Chiofalo · Answer

Hi Michael,

How much is the purchase price for this property?

There are a few ways to go about structuring the financing on investor loans with flexible terms to up to 85% loan to value.

John Underwood · Answer

See what similar properties are renting for and their occupancy and see if this pencils out or not.

Sarah Kensinger · Answer

I see it's under contract. Is that you or are you considering putting in a back-up offer.

Castle Rock- highest best use for House with View STR?

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