All Forum Posts by: James Carlson

Hey @Michael O'Brien

You know a month or so ago I would have said there's no way the city of Colorado Springs -- long a right-leaning, property rights driven council -- would have passed something so restrictive for short-term rentals and Airbnb. But something seems to have shifted, so now I guess I'd say there's an equal to greater-than-equal shot that they pass the density restriction.

As far as timing goes ... You've got time to find a place -- a month if you're diligent -- then another 30 days to close. You're at 60 days now. I was worried about how long the application process would take as well. BUT! The below note was attached to the signature of a recent email a friend received from the Colorado Springs planning department. (Pertinent part in bold.) 

If this email is in regards to a STR permit, please be aware this applicaiton submittal is the first step to establishing your STR permits(s). The submittal date will be what Staff considers for grandfathering in the event any permit density regulations change during the review of your application.

That seems to say that if you get your application in before the regulations change, you're good to go.

@Neil Hohmann

As @Matt M. said, there is no standard. Colorado law doesn't allow a set commission. That said, you might find agents willing to do it for less. The market seems to say that sellers in Denver on average are paying 2.5-2.8% to each side.

But like @Joel Owens said, if the agent seems to know what they're doing, then don't get too hung up on it. The ability to price a condo right the first time, market it well and communicate its value to buyers will likely save you more money in the end.

I think it's fine to ask your agent what they are bringing to the table to justify a commission that is higher than some others. The market has shifted a bit, so it's not the crazy seller's market it was a few years ago. Does that justify the extra? Maybe, if it's going to be a tough sell. 

Good luck!

@Steven Tawresey

Interesting question. Westword pulled average rents by Denver neighborhood this past spring and found the average 1br rent in Capitol Hill had dropped by $50 over the same time in 2017. But if you haven't raised rents in two years, I'd think you'd get some nibbles at least. 

My gut, based solely on anecdotes, is not to worry too much about it. (What could go wrong eschewing data collection and relying on gut?)

That said, those anecdotes ... I've got a client looking at 1br units in Capitol Hill right now and we've seen the rent roll on two other spaces that have only seen increases or steady rents with virtually no vacancy.

Also, my wife and I have two condos in Capitol Hill, one of which we live in (and had a third that we sold earlier this year). The two investments we furnished and rent medium term (think 3-month stays for traveling nurses). All have been rented with only a few days vacancy between stays for years now. The last year or so, all of our tenants came through Airbnb. We do get a good number of leads through Zillow, even though none have worked out. But we don't pay for that. We do whatever the free listing is.

That may not be a perfect comparison for you. I will say that since we've been renting our small units, we've noticed -- as @Jeff White said -- that we haven't received a legitimate lead from Craigslist for at least two years.

All to say again that I wouldn't read too much into it. If this continues for another month or so, 

@Mark Mo

In general, I believe in listening to your gut. That said, here are some of my thoughts:

1. @Russell Brazil is right that many times one offer begets another. You can try to work around this by squeezing the acceptance deadline on your offer, so that they have less time to wrangle up competing offers. But as often as not, agents in Denver will ignore the deadline anyway or a too-tight deadline can be seen as pushy. Either way, it could very well be that they had two other offers.

2. If you are really worried, you could try putting an escalation clause into your contract. It's additional language that says your offer is X amount but that if there are other offers, you'll pay Y amount above the highest up to a maximum of Z. (Ex: Offer $300k but will pay $1,000 above highest up to max of $320,000.) And then you include language saying it's contingent upon your agent's receipt of the other, bonafide arms-length offer. Now, yes, a really shady agent could get another agent friend to create a dummy contract, but damn that's a lot of work, and I just don't believe many (or maybe any) agents would risk their license and livihood to try to squeeze out a few thousand for their client.

Good luck

@Ben Kappel

I used my Denver MLS access to track down the location of your townhome. And then I found the listing you're talking about on Zillow. (Excuse the private investigator creep factor.)

A couple thoughts on this: 

1. Requested rental price is not the same as what the landlord will actually get. Looks like they initially listed the unit more than a month ago at $1,900. Then they dropped it to $1,800 six days ago and still haven't gotten anyone. 

I call this the "let's see" model of pricing, and I see this in Denver on the buy and sell side of things all the time. "Let's just see if we can get this much." It could end up being that you are closer to the market rent than they are. That said ... 

2. I'd still reach out to some other Denver area property managers. Some of the resources I use for estimating rents say a 2br in your area should get somewhere between $1600-$1700/mo. (That's average of course and depends on the condition of your place.)

3. A good tenant could be worth $100 or $200 depending on how good they are and how much work you actually want to do.

Good luck!

Congrats @Travis Hatch. A lot of people post on here. Fewer take the action. Awesome to hear you're taking a big step.

And I'll just reiterate what @Jeff White said. Denver law requires that a legal bedroom have two exits and that the window exit be big enough for a firefighter with full equipment on to fit through. That is called an egress window. While many landlords might rent out a "non-conforming" room (i.e. without an egress window), it's a short-sighted effort. If something happens and you get sued, kiss your returns goodbye. Not to mention the guilt of someone being injured.

Good luck with everything!

Welcome to BP @Noah Gregory and welcome to Denver. It's a great site and a great city. If you're interested in real estate and working in real estate, then come to some of the BP meetups in town. They're well-attended. If you want to get into the industry, I'd reach out to a few people who seem to be doing what you want. Buy them a coffee or lunch and pick their brain. 

Good luck!

Hey any Colorado Springs BPers! (And those simply interested in Denver's little sister.) 

A new proposed Airbnb ordinance in the Springs has me wondering whether it's now or never to buy an STR investment in some of the most popular areas of that city.

Just last year, the city council passed an ordinance allowing short-term rentals in any kind of investment property. Now things might change. Earlier this month, the city proposed two changes, but the one that's interesting to me is this: 

• A 500' density limit prohibiting any new non-owner occupied Airbnb within 500' of an existing non-owner occupied STR.

The density restriction, which councilman Knight said would be voted on next month, could essentially blot out huge swaths of Colorado Springs to future Airbnb investments. 

Here's the thing. According to the draft language, any existing or new STRs approved prior to the implementation date of the density restriction will be grandfathered in. The draft appears to say implementation date is 90 days after passage of the law. This could create a huge rush in the next few months to get in before the door closes. 

I've nabbed the current permit data from the Colorado Springs Short-Term Rental Alliance (shout out to COSSTRA!) and then mapped the current STRs. There are certainly pockets of the city that A) aren't blotted out by the overlapping 500' circles and that B) are also good areas for Airbnbs. But still, if this passes, many areas -- including most of Old Colorado City and broader downtown -- could be off limits to STR investment in a few months

I see this as a double edge sword. If you don't get in, then you could be out forever. But if you do get in (or are already in) in certain areas, then the city will essentially block all future competition. 

Let the bull rush begin!

Learn the Airbnb laws and investment opportunities in Colorado (specifically Colorado Springs).

We'll discuss:

-- The latest on Colorado Springs' efforts to curb short-term rentals
-- Why getting an STR before new regulations gives you a leg-up
-- What the law currently allows
-- Case studies of successful STRs
-- Insurance products to protect you
-- City enforcement efforts

Co-hosted by James Carlson Real Estate & Colorado Springs' premiere STR management company, HOSTE.
The class is FREE but please register at this link so we can give the venue an accurate count: www.jamescarlsonrealestate.com...

Learn the Airbnb laws in Denver and Colorado Springs and how to use short-term rentals to reduce your mortgage. 

We'll discuss:

-- Cities friendly to Airbnb investment
-- What criminal charges filed against Denver STR owners mean for you.
-- What you can do in Denver and Colorado Springs ... and what you can't
-- How to use the Airbnb laws to reduce your mortgage on your primary residence
-- Insurance products to protect you

The presentation is FREE but please register at this link so we can give the venue an accurate count:

https://www.jamescarlsonrealestate.com/airbnb-laws-class-denver-1