All Forum Posts by: Adam Kroll

I put together a spreadsheet for one of my clients and I've used it several times since. In almost all cases I've reviewed, holding is the best option. These were not savvy investors, so the alternative investment was not as attractive for them. I'd be happy to share if you pm me your email

Hey Grace, I always like to talk investing with you!  You've got a great mind for it.

Welcome to BP! Sidenote to Grace's story, she found the loft on the MLS. It is possible. Grace is also an out-of-the box thinker. Certainly worth your time!

Good work!  Where did you find this deal?

Are you willing to pay for property management?  This will provide a buffer from "difficult tenants."  @Dan Mackin makes a good point with the house hack idea.  You're 100% right that deal finding is the most time intensive process in our current market conditions.  Try less commercial sites such as craigslist to find FSBOs too.

@Scott Poole, I disagree with your stance on the bubble in Denver.  There is such a high demand that inventory is at 20% of normal.  There is a real housing shortage in Denver right now.  There are a lot of new builds to correct this housing shortage, but a bubble indicates that prices are over valued.  There is a large influx of population into the Denver market and not enough housing to satisfy.  It does not make for an easy time for investors, but I do not believe that Denver is in a bubble.

If you don't mind living in the future investment, you could put down as little as 5% on a primary (which, with $30k down,could get you $600k home assuming you qualify for that size loan). I can get you in touch with a lender that would be able to give you better advice on the lending logistics. Let's perform a thought experiment though. Using a 95% LTV, at an average home appreciation of 4%/year (national average is about 5% overall), you're appreciation is 80% of your investment. Obviously, you'll have holding costs your first year as you must live in the dwelling as a primary to qualify for the high LTV. After the required period ends, if you can rent the property for your mortgage + expenses, you end up with appreciation of $25k/year at 4%. You may need to break that into 2 investments of $300k to make the numbers work, but it's some food for thought.

I would recommend selling within 2 years of moving if it does appreciate. This will allow you to use the tax code 121 tax exemption on primary residence. Consult with a cpa for details. 

The main thing to consider is whether your equity would be better used in another investment vehicle.

Hey @Petie Ehm, I have the opposite approach to @Travis Sperr, not to say either is right.  I'm not sure my strategy is in line with your goals.  I prefer to be as leveraged as possible to have the cash on hand to purchase more properties.  As my properties appreciated, I refinanced to pull out cash to purchase more.  As long as I am cashflow neutral on the original property, I still enjoy cashflow from my newer properties and have an expanded cashflow footprint.

As far as financing, if you find a deal - you can find the financing.  This could be through partnerships or private lending.  I'm finding there is a lot more cash than deals right now.  Also, I'm not sure if this has been mentioned already, but you could get the most favorable financing terms for a primary.  If you're looking for a future buy/hold, you could move into it for a year as a primary and then turn it into a rental.  Hope this helps along your journey

@Travis Sperr hit it on the head.  To really nail down a strategy, you need to understand what you want out of your investment.  What is more important to you: appreciation over this span or cashflow?  How much time are you willing to invest into this endeavor?  I would suggest that you familiarize yourself with the area so you can make better assumptions of what you want.  I'd be happy to help in any way I can (also from the East Coast originally).