All Forum Posts by: Ben Einspahr

This is one of my favorite questions because it boils down to optimizing your rental portfolio and what separates good rental property investors from great rental property investors. As mentioned above, you have multiple options to consider but the 3 main ones are HELCO, cash ur refi, sell and trade up via 1031.

before going down that road you will want to take a deep dive into your current properties health. The 3 main metrics I look at when deciding to make a big decision like this is:

Cap Rate greater than 4%

Return on Equity (ROE) greater than 10%

And Loan to Value greater than 50%

If you are below any of these metrics, may be worth considering selling and trading up via.

With this being my favorite topic in REI to cover, I create a spreadsheet that help run all of these numbers for you and spit out some cool charts. Happy to send via messenger.
Best of luck!

@Judd Meng Welcome to BP and congrats on taking that first step

You have a couple different options IMO. 

1). Yes is obviously house hacking. I am sure this has already been mentioned in comment above but focus on finding a home with some form of separate income suite to rent out so you are not sacrificing too much privacy. 

2) or....smaller rental property investing. (condo or town home in your back yard). This will not move the needle for you too much as far as cash flow but that is not what you are looking for in this first investment. A first investment property, regardless of your age should consist of one principle, K.I.S.S. That way you do not spend 1-2 year researching creative financing strategies or trying to rack your brain around what OOS markets should I invest in and what ones i should stay away from. That is not even touching on building your team virtually. 

With this first investment property you will receive the following benefits: 

-basics of rental property investing.

-self managing (i recommend self-managing since it is in your back yard plus you will be saving that 10% mgmt fee)

-asset appreciation

-principle pay down

-confidence going into your next property 1-2 years down the road (consistency is key)

Again, your first property does not need to be a home run. Consistent base hits win championships.

@Noah Thompson if you are trying to purchase multifamily to by as primary and house hack, you biggest hurdle will be financing.

Google the FHA self sufficiency test. This applies to 3 and 4 units properties. It states 75% of the rental income must exceed your PITI. And those rental comps come from your lender, not you. So STR income will not apply. To offset that ratio you will need to put more down. By the time you have put more down, you might as well purchase it as an investment property and the more money you start putting down, the less returns you will start to see.

To touch on @Ben Rhodin last comment that was not mentioned anywhere else is "digital nomads". in my MTR in Arvada has mainly been occupied by digital nomad that typically come from places other than FF. With that said, being close to a hospital is nice, but not required.

Other thing is pets. Yes pet. If you are having trouble filling, would be worth considering allowing pets. It was a tough decision but, so far, happy we started allowing.

@Tamera Muniz so sorry to hear about the HELOC. Keep in mind that this is a long term investment and we are in the slower months. Since 12/31 have you done anything different with your listing? Move some photos around, change listing name, adjust pricing (not undercut competition, just drop it down a few), offer any "new listing discounts"?
Doing some of these things could help trigger some of Airbnb's algorithm and push you listing up to the top to get some more view.

On the other hand, I have heard from many newer guests that their first month or 2 was slammed then dead which makes me to believe that airbnb will favor you for a month or two to hook you and get your bough it. After that time period, you are on your own. I could be off in left field though.Best of luck.

@Dan Mackin This is a great detailed post. thank you for sharing. really cool seeing the before's and after's

Hello @Roman Puzey you have reach out in the right place. I would have to disagree with the post above. House hacking in Denver Metro area (not Denver specific) is definitely as i have done it multiple times and helped many others do the same. You just have to be familiar with the nuances of STR rules and regulations.
Addition you need to have a solid plan A and Plan B after moving out to make a successful stabilized rental. 
First plan of action would be to get familiar with surrounding city STR rules and regs. Next find yourself a meet up to start expanding your network and connect with others doing that same thing you are looking to!

Best of luck!

@Michael Henry From a pure outsiders business prospective no :/ I am not sure what your current job is but taking a 180 career change will kill your chance of getting financing. Also, 99.99 percent of the deals for HH'ing can be found directly off the MLS.

Buy the HH's first to boost your savings and wealth then go into photography if that is a calling.

Best of luck!

@Weston Flowers welcome to BP! REI can be pretty overwhelming with so many strategies to choose from. You have picked the right place to start. I am sure this is not the first time hearing this but house hacking is a great way to get started with first hand land lording experience and low capital to acquire. It is even possible with a family. I know first had because that is the strategy I am doing and I have a little one at home too! And with your current home you have, keep it and turn it into a rental. Bam 2 birds with one stone :)

Regarding your career path and being burnt out. Not sure what career you are in but my best advise is to stick with it as long as possible. If you do choose to change careers, thats fine. Just be sure it is in the same field of work. Lenders love consistent W2 professionals. Lending will be your biggest challenge if you decide to go from Financing to Construction for example.

Seems like you are still in the sniff test stage. I would recommend joining some local meet ups as well to connect with like minded investors in your local area. That can be a very undervalued part in the educational phase.

Best of luck

@Jeremy Martinez, I would agree with most others on here. Sounds like you need to find an agent specialized in what you are trying to do. Nothing personal, just business.

If you are looking to HH, don't waste your time with wholesalers. 99.99% of house hacking can be found directly off the MLS.

Last thing. Find yourself a local meet up to expand your network and connect with others that are doing the same.

BEst of luck.