All Forum Posts by: James Carlson

@Alex Folchi

Yeah, I wouldn't let any fear of the unknown stop you. But be clear with the lease about expectations. The thing I would want to make sure she understands is that as a tenant, she shouldn't be making changes to the house without consulting you. I could see her -- as @Account Closed alluded to above -- still thinking of the place as her own and modifying things. Anything she does going forward she has to pay for, get permission for, or have it subtracted from her security deposit at the end. 

@Alex Folchi

It happens all the time here in Denver and Colorado Springs. The market moves so quick that syncing up a sell and a buy is tough, so you get sellers asking for a post-closing occupancy agreement all the time. It sounds like a win for everyone if she needs a place, and you want to have a tenant in as soon as possible. The big question is if she's willing to pay the rent you want. If she's lived there for awhile, her mortgage might be quite a bit lower than the rent you could garner, so while a win-win is nice, doing so at the expense of hundreds per month is not so nice. 

And yes, it's a standard tenant situation. Have her sign a standard lease and bring the security deposit check to the closing table. Good luck!

@Lauren Miles

Welcome to the tribe! It's already been said above, but I'll reiterate that having your own investment is the first step in being an investor-friendly agent in Denver. Reading is great, but doing is better in the eyes of most buyers looking to invest. I get the question from every potential investor client we talk with. "How many properties do you own?" We have a couple properties in Denver and Colorado Springs, otherwise, I think I'd lose most clients at that question. 

House hacking is a great first step, especially in hot markets like Denver. Don't worry too much about the step after that. Just take the first one and get started. Good luck!

@Matthew Forrest " ... getting involved NOW will probably be more valuable than any money you lose (if you lose any at all)."

Amen. Couldn't agree more. The experience you gain from buying is way more than anything you can read on this site. And again, if you're buying for a long-term buy-and-hold, the market in most desirable areas -- like here in Denver and Colorado Springs -- is going to go up. If you think you might have to sell whatever you buy in the next 2-3 years, then who knows. But long-term? It's a pretty good bet.

@Natalie Fryda

I'm assuming from your post that you already own your primary residence in Denver? If so, then all the other people's posts apply well. If not, I think your first "investment" should be in the home you live in. You've got to pay rent somewhere, might as well be to yourself. And if you want a rental component, you can always house hack either by the room or -- if you want more privacy -- by finding a home with a basement apartment or a carriage house/mother-in-law suite out back. 

I sense that your goal is cash flow, but at the risk of sounding like a Denver-centric investor agent here, there are other considerations. Like that Denver has averaged 6% appreciation over the last 40 years. That doesn't get you that passive income, but in terms of building long-term wealth, appreciation is a big, if not the biggest, driver.

Anyway, good luck with your ventures. It's great that you're taking steps to put that money to work. Cheers!

Our first property was a 1br condo in Denver. We used a conventional loan, 5% down. Because the market was (and still is) so hot in Denver, we had a lot of equity in the condo after a year and pulled it with HELOC. We used that HELOC to buy our second property. With the cash flow from that second property we bought our third and have continue that way ever since. (We currently have four properties and five doors.) We try to use the HELOC only if we need it. We'd rather not be super leveraged.

If you're young enough and in it for the long haul, then any market can work. Just depends on whether it will be easy or hard. In Denver and Colorado Springs where we work and invest, it's pretty tough to cash flow. 

You've got to get creative. We have four properties (five doors) and all are furnished medium term rentals, which helps juice the revenues a bit. If you're a young person buying your first place, then house hacking with roommates or finding a place with a mother-in-law suite can be a great option to get your feet wet, start building equity and offset your mortgage. 

On that point, like @Account Closed said, we like to find our clients properties that have a carriage house or basement apartment and are zoned for two units (either "TU" in Denver or "R2" in Colorado Springs). That gives you rental income while you live there and the option to rent both units when you move out. 

@Jason Ehrlich

Congrats on the move, man. That's awesome. We live in Colorado Springs at the moment and can't imagine living anywhere else, but the ocean is always a big draw. Sounds like you've done some good work on your home and that will be exciting to see it pay off with a nice pay day.

Good luck with the new adventure!

@Erin Snow

Welcome to the forums! And I hear you about falling in love. I moved from the midwest to Colorado about 10 years ago and never looked back. The city is great, but what I always come back to is the nature and the weather. (No more weeks on end of overcast weather.)

Anyway, it sounds like you're taking some big steps. That's exciting. We love the mother-in-law suite idea. We've seen a number of clients who aren't psyched about the traditional rent-by-the-room house hack go the basement apartment route to still offset their mortgage while also maintaining some privacy. 

I wish you luck whatever you end up doing. Cheers!

@Matt M.

Totally, things could change quickly when that loss of $600 trickles in.