All Forum Posts by: Bridget Brazelton

If you're a house hacker in the City of Denver, you may be painfully aware of the city's current stance on unrelated adults in a household. Denver currently allows just two unrelated adults per house, or up to three with a permit. Although the city tells me they only enforce the regulation when they receive a complaint, it's still a consideration that leaves some local house hackers thinking twice, or looking at buying in surrounding cities, such as Aurora, where the maximum number of unrelated adults is four.

Tonight, that may all change. As I type this, the city council is debating proposed changes to the group living rules that will increase the maximum number of unrelated adults from two to five. The final proposal will be voted on tonight and is the result of several years of work by the Group Living Advisory Committee with extensive feedback from the community (you can read some of the many hundreds of public comments here).

If you want to take a deep dive, you can view an overview of the proposal here, and draft text of the proposed amendment here.

In case you just want the highlight reel, notable points include:

• 1) Allows up to 5 adults of any relationship to live as part of a household
• 2) Rent-by-the-room scenarios managed by non-residents would still be prohibited in single unit, two unit, and row house zone districts
• 3) The 20% of properties still governed under Chapter 59 (The 'old zoning code') are not covered by this change
• 4) The number of vehicles allowed to be parked on a zone lot is also proposed to be changed. Current regulations allow 1 vehicle per driver, plus one additional. The new proposal allows an across the board maximum of 6 vehicles.

What do you think, Denver? As a real estate agent specializing in house hacking, as well as a house hacker and investor myself, I sincerely hope the city adopts these changes tonight and modernizes its views on what defines a household.

@Steve Morris my mistake... you're right, thanks! @Rita Davis The APPRAISAL on the quad last month was $1,000. But, that was 1 building, not two. And 4 total units, not 5.

Hi Brandon,

I agree with @Ben Rhodin’s assessment that while there is some good knowledge to be learned in the licensing coursework, the most important learning takes place on the job. I used Colorado Real Estate School’s online course, and it adequately prepared me for the test, but I’ve yet to find a Colorado agent who has raved about their chosen school. Good luck and congratulations on your decision to get started!

Congrats on your first house hack, @Anastasia Bourdon! Best of luck with the clutter! Whenever I’ve experienced such irritations, I find that quietly muttering to myself “they pay my mortgage....they pay my mortgage....they pay my mortgage” is enough to put a smile back on my face ;). In all seriousness, best of luck and congratulations.

Hey @Ann Wing, I think it's smart to not rule anything out, ESPECIALLY because of how hot our market is here in Denver. Someone who comes to mind that has used new builds to build their investment portfolio is @Todd Baldwin in Seattle (also a hot market). Check out BiggerPockets Podcast 392 if you're interested in hearing his story. It all comes down to a numbers game. All things being equal, a new build is fantastic because a) there's no deferred maintenance, and b) you'll have new fixtures and modern layouts that will garner top rents. But, that needs to be balanced against the premium you're paying to get into a new build, so without specifics it's hard to say whether it makes sense. In master planned communities also be sure to check into the HOA, if there is one, to ensure your rental strategy is allowed there.

Hey Mark, congrats on your upcoming move to Denver! It's an awesome city. @Jeff White gave you some great advice and options to think about. I agree with his assessment that house hacking is one of the best ways to get started here. My current house hack in Denver is a 6 bed/3 bath single family home that has a basement apartment with its own entrance. I rent the bedrooms downstairs by the room and it covers the mortgage and utilities. I like homes like this one because it gives you the option of splitting it off and having your own unit if you'd like, or sharing your space with a roommate(s) to increase your profit. I always recommend running your numbers twice: 1) how will this change/improve your housing budget while you live in the house? 2) what is the cash flow for this property when you move out of the house? If you're working towards financial independence, both are important.

There are so many great neighborhoods in Denver, and so many projects in the works. You could sign a medium term lease (maybe month-to-month) upon arrival and use that time to scout neighborhoods. I closed on my first house here 6 months after I moved, and networking with other house hackers is what gave me the confidence to know I was analyzing the deal and projected rents correctly. Feel free to reach out anytime about real estate, hiking or skiing!

I'm interested in following along and seeing how your offers go. I just closed on a quad in Colorado Springs and will echo what many of the others have said: sellers have many choices in this market, and besides price they want to go with the offer that looks like the best bet and least hassle to get the deal done. I recommend working with your agent to see what additional language you can write into the offer to show that you're a serious and capable buyer that won't try to nickel and dime them through the process.

Also, although there are tons of bidding wars out there, sometimes you can find a diamond in the rough. I saw an interesting triplex sit on the market in a west Denver neighborhood recently for almost two months. It needed cosmetic work but it had tremendous upside potential. I've seen a few quads in nicer neighborhoods at higher price ranges sit for a week or two as well, so it just depends what you're looking for.

Is your loan type a seller's first choice? Probably not. You may hear 'no' a multitude of times before you hear 'yes'. But if you and your agent keep looking and keep making offers, you will succeed. And that's a well earned, fantastic loan program to buy it under when you do. Congrats in advance and welcome to Denver!

@Anastasia Bourdon what ended up happening with this? Did you end up renting to your friends?

While I think that it was poor form for them to ask you for a discount after agreeing to the price (and so close to closing!), I would have thought through it as follows:

1) How much of a discount are they asking for? Let’s say it’s $50/mth each, so you’d be bringing in roughly $1500 in total rent instead of $1600. Over the course of 1 year, you’ll bring in $18,000 in rent.

2) If you stand your ground and they don’t move in, how long will it take you to fill these rooms again with strangers? Hopefully less, but let’s say it’s 1 month. Over the course of 1 year, you’ll take in 11 months of rent at $1600, so $17,600 in rent.

With these (hypothetical) numbers, you actually come out $400 ahead by appeasing your friends with a discount. I rented a room to one of my best friends in my first house hack at a sizable discount and it was one of the best moves I made (I trusted her, and she even helped me with house projects). Moving is a lot of work. Setting up a house hack, especially your first one, is a lot of work. Having your first tenants taken care of is one less thing to worry about, and sometimes it’s best just to get the income coming in and you can maximize your profits as their leases expire.

Hey Jeremy,

I have a Colorado based insurance broker that I use for my investment properties, primary home and umbrella insurance. I find him extremely responsive (usually responds in a matter of minutes, even on nights and weekends), knowledgeable and he shops for the best rates for me periodically without being prompted. I also find him to be honest; he tells me when he can't beat a rate I'm getting elsewhere. I'm happy to send you his contact via private message.

Welcome, Jesse! Look forward to following your journey :)