All Forum Posts by: Jeff White

@Caleb LaBelle Congrats on taking a giant first step!  Combining house hacking and airbnbing is a excellent idea!

1) I have utilized Airbnb before, and it is most effective between April to October months since that is when tourism in Denver is at its peak season.

2) Anywhere in Denver is great, especially the hotspots of Highlands, Sloan's Lake, Wash Park, Platte Park, City Park, RiNo, close to downtown, etc...but just like anything else, pictures will do a great job if you are not in those prime locations. 

You won't get the premium rates, but you can still run a successful Airbnb with great pictures and a good description and an immaculate home. From a price to Airbnb ratio, look for houses on the edge of those locations I mentioned above, ex. Lakewood is right next to Sloan's Lake, Englewood is close to Platte Park, Wheat Ridge is next to the Highlands. It is a way to benefit from being nearby those hotspots without paying the premium price to buy in those locations.   

3) About 30-60% due to less tourism from COVID and time of year. AirDNA is a great resource to confirm projected rents. 

4) If you are only considering Denver, the only catch is it MUST be your primary residence. You will have to show documentation that you live there and sign an affidavit confirming that.

5) Have you considered Arvada?  Denver is a great city of course, but you can only Airbnb your house WHILE you are living there. Once you move out to the next house hack, you can no longer Airbnb that basement apartment. On the flip side, Arvada currently allows up to 3 properties that can be on Airbnb even if you don't live there. Can that change in the future?  Absolutely, but it is something to consider since Arvada is a cool suburb and close to downtown.

@Laura MacDonald You have a great background in real estate, so it won't be hard to get back into it. Like Matt said above, the key will be to find out what you qualify for, and that will determine your strategies for short and long-term. Start with a traditional mortgage broker to find out if you can get conventional financing since that will be your cheapest money. 

1) Since you are ready to absorb more information, Biggerpockets is a goldmine for information, read everything!  You will find thousands of articles, posts, podcasts etc on basically any thing you want from starting out to situation questions and answers.  All of it is free too.

2) It depends, do you have access to business lines of credit, personal lines of credit, or private friends/family money?  Since they aren't traditional banks, personal tax returns aren't as important to them, and you can go from there. 

3) Denver and Colorado Springs are both fantastic appreciating markets, and I'm a big believer in buy within 1 hour of where you live. The purchase price is definitely higher, but if your goals are long-term, you will be happy with whatever you end up buying.

@Bridget Brazelton Great news, it passed city council and now, it will go over to the mayor for approval. This is a huge win for anyone that rents by room in the city of Denver!

@S Anderson That's great you have equity and have the ability to pull some of it out of your rental via cash out refi or a Investment HELOC. That's a tough question. I'm in Denver too, and I like having my properties within driving distance of me vs. out of state where you are reliant a great property manager or friend/family. I know that you can get better cash on cash returns out of state, but Denver has its own benefits too: diverse economy, great beer, net migration is positive with no signs of slowing down, awesome weather, etc.

It sounds like you want to spread your risk over multiple investments, there are condos/townhomes that you can buy in Aurora that would fit your criteria.... ~200-250k for a 3/2 turnkey place, and you can probably rent them out for 1850 easily, so with 25% down for each, you can purchase 3 of them right here in your background, be cash flow positive, and still get some nice long-term appreciation. 

@Kayla Givens Ideally, it sounds like you are using a 3% conventional down payment for a primary residence loan, correct? If so, in that price range, I would try to do what @Ben Rhodin is suggesting to qualify for a little bit more because once you get to that 400k+ range, it opens up more single family houses that are available in decent condition.

On average, single family  homes have appreciated about 6% per year the last 40 years in Denver metro. Condo and townhomes appreciate a little bit less, but they are still a solid investment long-term.  

As of today, for homes under 400k, there aren't many single family homes available that don't need a lot of work or located in upcoming areas of Denver. 

Townhomes aren't a bad idea because usually they are in good shape and would fit your price range and sometimes have nice yards and good parking. The key thing with townhomes is the HOA, make sure you do extensive research on the HOA reserves and how often they have raised their monthly HOA dues per month, some raise it every year! Not all HOAs are created equal, and ideally, you want the HOA to well-managed.

Condos are little bit tougher since they are smaller than townhomes and harder to make the numbers work unless you go out to east Aurora where you can find 3/2 condos for 200-220k.

@Robert Herrera Have you done lease options outside of Pueblo? I wonder if that would work here in Denver? 

@YiBing T. Sorry to hear that your tenants are taking advantage of it. Luckily, I'm fortunate enough to have all my tenants paying today, and I know it is tough right now. 

If I were in your shoes, I would negotiate a cash for keys move out as soon as possible. Extra money can be a huge motivator for people. Also, sometimes tenants don't know that you are just a mom-and-pop landlord, you aren't a big corporation with 1000s of units, and that's what I would communicate to them. Obviously, they can afford to pay rent with full-time jobs, but they feel like they don't have to pay and that's wrong since you are still on the hook for the mortgage, property taxes, insurance, repairs, etc. 

Whether you self-manage or have a property manager, good communication is key. 

@Patrick Gledhill I would definitely talk to a lender, a way to help mitigate the debt/income ratio is to rent out the space in your house whether it is a room or basement to generate some rental income to offset your mortgage, can you do that? 

@Neal Ichinohe I can totally understand where you are coming from when you see the prices for the average single family homes out here!

Denver has gotten a little crazy, but there are lots of ways to make it work. 

It is a a question your comfortability. 

I've done everything from rent by room, multifamily, normal rental units, etc. House hacking is basically just reducing your living costs with the goal of living for free, but that's not always the case. 

There are still ways to make it work in the Denver market without paying a huge premium, have you thought about a townhouse or condo? 

The most important thing is not to hit a homerun on your first deal, but just get started.

Once I did my first house hack, it allowed me to learn and grow and invest, and then, I purchased my next one only one year later.  

@Rita Davis Multifamily is usually a bit more money, and this deal sounds commercial since you mentioned a triplex and a duplex (5 units total), depending the appraisers in the Cali market since they have to inspect five units instead of a one, so you are dealing with commercial appraisers, which will probably run you $1k-$1.5k.