All Forum Posts by: James Carlson

Colorado Springs provides a unique investment opportunity through short-term rentals like Airbnb and VRBO.

Unlike many cities along the Front Range like Denver that have either passed restrictions or are considering it, Colorado Springs has no restrictions and -- as of now -- has no plans to do so.

Come grab a drink and learn:

• What kinds of short-term rentals are allowed
• What taxes you need to pay and how to collect them
• How to protect yourself with the right insurance
• Whether the city may change their laws in the future
• Broad overview of best practices for hosting

The event is free, but please RSVP here on Bigger Pockets or register here .

Details?

Airbnb Laws in Colorado Springs
August 23, 2017
6 - 7 p.m.
Jack Quinn's Irish Pub & Restaurant
21 S. Tejon St.
Colorado Springs, CO

Want to know what you can and cannot do with Airbnb and short-term rentals in Denver and other Colorado cities?

Come grab a drink and learn all about:

-- Denver's primary residence rule

-- City enforcement efforts

-- Cities more open to Airbnb

-- Tax collections

-- What insurance you need

-- Duplexes, basements & carriage houses

-- HOA restrictions

-- Creative workarounds ... and why they probably won't work

Carbon is nice enough to provide a free glass of champagne. The event is free, but please RSVP on Bigger Pockets or register here. 

Details?

Airbnb Laws in Denver
August 21, 2017
6 - 7:30 p.m.
Carbon Cafe & Bar
1553 Platte St, #130

@Christian Roman

Welcome to BP and to the Denver metro area! The mountains, 300 days of sun, great beer and legal weed ... it's a pretty interesting time to be here in Colorado. 

As a former Orlandoan, I will echo @Chris Lopez 's thoughts on humidity. It sucks. I'll also echo his stereotyped sentiments about the house-hacking gender differences. I get a lot of male buyers wanting to house-hack or run an Airbnb in their property. Often, however, their girlfriends or wives are neither interested in living in certain areas nor living with strangers. 

Other than that, get with a solid local lender and a solid real estate agent who you feel comfortable with. Go out and see places. Talk through the options. And most importantly, take the next step.

Oh, and come to some of the meetups. There's a good one up here in the Uptown neighborhood of Denver, but some good folks just started one down south as well. 

Good luck!

@Jason Reed

I think typewriters, hardback encyclopedias and, more recently, taxi cabs might have something to say about the staying power of disruptive technologies. An interesting take on Airbnb, for sure, but one I completely disagree with. More and more, people around my age or younger (and even older) are looking to Airbnb instead of hotels. Full kitchen and living space, outside the hotel district, often cheaper price? That is quite appealing to people. Right or wrong, what the market wants, the market usually gets.

There is no broad brush painting of cities' Airbnb laws. New York and San Francisco have certainly tried to ban all or portions of this industry. Take a quick look at the Airbnb site, and you'll see that's not working so well.

The laws are a patchwork of political positions across the country. Just 100 miles apart, three cities here in Colorado offer a perfect example of the variety of regulation. Liberal Boulder has very restrictive laws that, in certain scenarios, only allow you to host for parts of the year and only in your owner-occupied primary residence. A little further south in only slightly-less liberal Denver, the rules also restrict it to your primary residence, but tenants can also Airbnb and anyone who's legally doing it can do it all year round. Travel an hour south to conservative Colorado Springs and property rights rule. That city has no restrictions on short-term renting a property or properties. I've talked to the planner who oversees this stuff, and they have no plans to restrict that.

(BTW, I know the Airbnb and short-term rental laws quite well here, and I don't know of any "ban" on Airbnb in Colorado.)

To your other points:

• Some restaurants may be losing out, but others are winning. Airbnb tends to take visitors to the non-hotel districts where local restaurants are capitalizing off an influx of new visitors. 
• And any argument that can be made about a short-term tenant can be made about a long-term tenant. A bad STR tenant is gone in a few days. A disruptive LTR tenant is there for a year.

There are certainly downsides to Airbnb -- both to a city and to a landlord and neighborhood. But on the whole, I think Airbnb is a wonderful evolution of the accommodations market, and I don't see it going anywhere.

@Cameron K.  

@Bill S. is right. My wife and I do corporate rentals with a few spaces in Denver and are about to partner with some other folks to buy a few more. I definitely got some of our initial inspiration from @Micki M. said, the occupancy rate is going to depend on your location. You say in you're in a walkable area? Where exactly in Denver? That's going to be huge. After that, the biggest factors are your furniture, the staging of the space, and good photos. Do all of those and be in a good neighborhood and you're going to have no problem getting booked. 

To give you an idea, my and my wife own two small spaces in Capitol Hill. 

• One is an 800sf 1-bedroom unit rented for $1,900. I think we'd be getting $1,300-$1,400 as an unfurnished long-term rental. 
• The other is a 350sf studio rented for $1,700. I think we'd get $1,000 as an unfurnished long-term rental.

I once had two weeks vacancy on the 1-bedroom, which was largely due to laziness on my part. The studio is always full. I would buy studios all day for this reason. The 1-bedroom doesn't seem to draw much more. A 2-bedroom, though, might be another bump in revenue.

@Ryan Evans

I love the idea and love Airbnb's potential. I think one of your questions (and another you didn't ask) are important. 

Insurance

If you're going the short-term route, be sure to get the right insurance. Without it, you could be liable and without coverage for anything that goes wrong during a short-term rental (STR) stay. Most major carriers don't yet offer STR insurance. Go with a company that specializes in it. Proper Insurance is a legit option who has done well for clients of mine.

City laws

I infer from your question that while you're near Leavenworth, Washington, you're not actually in Leavenworth. If you are in the city limits, be aware of those Airbnb laws. This  news article from March 2016 says the city is considering changes and that currently rentals of less than 30 days are prohibited. This policy paper drafted by an attorney at the request of the city council affirms that (at the bottom of page 2).

Can you get away with it for awhile? Probably. But you need an exit strategy. When I talk to Airbnb hosts here in Denver, I tell them to consider transitioning to medium-term furnished rentals of 3-months or so. Traveling nurses are a good target for that. In your area, I'm guessing that's not a big demographic, so I'd consider what else you could do should the city crack down.

Again, if you're not within the city, then this doesn't apply to you. But I'd call up the county then and talk to someone in planning or zoning to know for sure what can and cannot be done. Whatever laws they do have, I'd still go in with the idea that they could change in the future and plan accordingly.

Good luck!

@Matthew Moore

That sounds like a good plan. Split the difference. (Though, I'll be interested to see what you make on that Airbnb room and if the money coming from that will change your mind about the other. When Denver was the wild west of Airbnb years ago, I thought I'd only do it at one place. The profits pushed me to do it again and again at other places.)

I'd reach out to @Tyler Work for short-term property management in Colorado Springs. 

Hey @Lynae Chambers No worries. I will have more in the future. Good luck with your ADU. I am interested to see how it turns out and how you maximize its potential.

@Matthew Moore

It sounds like M2M might be the best route. However, if you looked into Airbnb or VRBO (short-term renting), and the numbers seemed good, you could hire a property manager. I know a few who can handle everything -- setting up property, guest communication, key handoffs, cleaning, and in-stay requests -- and they do it down in Colorado Springs (or Fountain, Colorado, in your situation). 

Again, maybe not what you're looking for, but I thought I'd throw it out there.

This is admittedly a bit last-minute, but for those interested in Airbnb, VRBO or any kind of short-term rental, I'll be giving a brief talk about the laws in Denver and other front-range cities TONIGHT.

July 31, 2017
6 p.m.
Capitol Hill Tavern
1225 Logan St.

Parking can be difficult. Show up a bit early to grab a spot and learn about:

-- The primary residence rule
-- Cities that are open to Airbnb investment (hint, hint ... Colorado Springs has no restrictions)
-- Denver enforcement efforts
-- Tax collections
-- What insurance you need
-- Duplexes, basements & carriage houses
-- HOA restrictions
-- Creative workarounds ... and why they probably won't work

Free, but please RSVP here or register at my website so I can give the venue a headcount:

James Carlson
720-460-1770
[email protected]