All Forum Posts by: Phillip Bicker

I highly recommend Calvin Lennberg who is a CFP and owns Advanced Investments in Denver/Castle Rock. He is an extremely knowledgeable financial planner, but he also holds his Colorado Real Estate License and understands/advises in real estate acquisition as part of your overall portfolio. I'll PM you his contact info (as I cannot post here). 

@Tashinga Musekiwa   Assuming you are in Colorado Springs, you can find cash flowing properties that will be strong buys now. If you buy and live in the property for the time being, this would be a good way to start building a portfolio while being able to get the low down payment and low interest options that a primary residence allows (up to 4 units). There are plenty of mortgage options out there where you can get in anywhere from 0% to 20% down with 3-5% being easy as a primary mortgage. 

One thing to note - if you live in a property in 2 of the last 5 years you can completely exclude $250k of gain or $500k if filing a joint return. So it might be wise to stay in your home/duplex for 2 years if it doesn't extend your time too substantially. That way in a year or two you could have the option of selling without paying a gain on the sale (not just defer the gain using at 1031). 

Hope this helps

If you want any more info about the CO Springs (or Denver Metro) market feel free to PM me

@Michael J Martinez I think your smartest bet would be to talk to a couple banks about a HELOC and about a new mortgage. If you sell your house, would you be purchasing another home - you will be facing the same credit issues with a new purchase as well. Honestly, I think your best bet would be to really focus on your credit for now until you can get it to a level that is sufficient to do a HELOC or a home purchase. Otherwise, you will likely be spending more on rent after your sell your house and may not be able to live in a home/area you want due to only being able to rent.

I think the very best option would be to sell your home and then house hack if you have the willingness and family situation that would allow you to do so. This would either be living in a home that you can rehab as you live there (preferably for 2 years for the home gain exclusion so you never have to pay tax on the gain up to $250k or $500k if filing joint taxes) OR buying a multi-unit property and living in one of the units and renting the other ones (you can get conventional residential financing up to 4 units). 

Good luck!

@Casey Mendelsohn

Where I recommend: Move to South Denver, with a plug for Castle Rock. Great place to live, great schools (especially the charters, but public schools good too), very family friendly with countless parks and trails, brand new/great hospital, about 40 mins to airport. Low taxes and business/RE friendly gov. Very welcoming/inviting to transplants. 

As for investments at the 1% rule. This is the tough one. You will get close about 30-45 mins to the south in Colorado Springs, or you will be able to hit it in Pueblo (just over an hour south). 

Quick forewarning - the Denver Metro MLS, Colorado Springs MLS, and Pueblo MLS are all in different systems and Realtors usually don't not have access to each. If you are looking to move into the area and invest in another, make sure your Realtor has access to at least 2 of these.

Good luck deciding!

@Jeremiah Dye If you already have both parties and just want help reviewing the contract there are a couple ways to do this. I would strongly recommend having someone review the contract with you and helping you to write it. Either you can pay an attorney a flat rate to review (you pay them whether or not it goes through) OR you can go into a larger brokerage in your area (like a Keller Williams) and just ask if someone would be willing to write up the contracts for you for "x" amount or "x%" .  Someone could likely just walk through the contract and basics of inspections/appraisals/etc for you for a relatively small fee.

@Matthew Cook I can't speak to Greeley, but the Springs does have some great multi-family opportunities. Even though Denver has 4x more homes than the Springs, they have a fairly equal amount of multi-families available on the MLS. You can find good cash flowing properties in the Springs now, even though things continue to rise down there. You can buy for just over $100k a door if you are looking at a 4plex ($425-450k will get you a good fourplex renting at $850-1000 a unit). I just helped someone buy a renovated 4plex off of the MLS for $400k that is currently renting at $3,400 but will immediately increase to $4,000 a month with minimal vacancy after ownership transfers. This is one of the better results of buying actively listed properties right now for this area (or anywhere nearby).

@Matthew Cook 

If you are looking at a buy and hold investment, I do not think it makes sense to rent out your current home. You are renting a $375-399k property for $2,200 and you could get a much better return on your money if you invested in a property better suited for rentals. For example you could move this money to the Springs and get a 4plex around $400-425k and get about $3400 in rent or you could move the rental to an area like Columbus that you mentioned and attain the 1% rule (rents of at least 1% of the price of the home). 

You are in a great position to take advantage of your VA benefits buy taking the profit out of your current home and using that to invest in new properties (by buying your new property at 100% LTV).

Good luck!

@James Ross

@James RossWelcome to BP and investing in the Springs! You are at a point that is the hardest for most investors - making the step to buy your first investment property. All too often, people get caught up in analyzing and over analyzing deals or plan just getting nervous and never "pull the trigger". 

I think the best way to get started is to think about what you are truly looking for with your investment properties. Are you solely interested in cash flow or are you going to consider appreciation or value add opportunities? Do you want this very passive with a property manager or do you want to "get your hands dirty" and understand the ins and outs before passing the torch? Do you like the idea of maximizing cash flow with multi-units or the familiarity of single family homes? 

After you get these general ideas solidified, you can start to look at what metrics you will use to analyze the deals instead of going on what other people tell you or going with your gut. For example, do you require a $200/per door cash flow and 10% cash on cash returns or are you looking at a 5 year ROI that includes appreciation and selling costs? There are good investors here that you can bounce ideas off of or you can also find an investment knowledgeable agent to help you as well - just make sure they know investments, the area you are investing in, and will help you through the process.

There are still plenty of deals to be had in the Springs, but you will want to make sure to define exactly what you are looking for, having any financing lined up, and have an agent that can help you jump on opportunities immediately when they come available. 

Good luck and of course feel free to reach out if you would like any help in the Springs!

Hey @Mark Costa, 

I have a great agent for you that is out of Roanoke that does a good amount of business in Blacksburg. She is a full time Realtor that has been doing this for years and will be able to help you determine the best area(s) to buy in Blacksburg. I'll PM you her info now. Have fun looking and make sure to tell her I sent you :)

Hello @Leah Hill, 

From the figures you shared, you would be able to use these funds more effectively than your current home if you like being a landlord and having investment properties. This is approximately a 5% cap rate where you can do better, especially if you invest in the Springs. You mentioned you have better cash flowing properties, so you can see the value of finding properties that are performing better than this current property. Right now you money is not utilized at its full potential with being tied up in this home. 

It will be interesting to see where our market goes, but I agree that it is a great time to capitalize on the appreciated values. If you are able to sell at $560k you would be able to clear about $60k that you could use for the next property.

Basically with knowing there could be some potentially large items to fix in the near future, knowing that you could utilize the money better elsewhere, and seeing where our price levels are right now, my suggestion would be to 1031 this property into a better cash flowing property with more stable long term values. Feel free to PM if you want suggestions of specific areas or ideas. 

Good luck with whatever you choose!