All Forum Posts by: Jeff White

@Steph S. Congrats on taking the first step toward financial freedom!

I'm a local Denver agent and investor, and I think Denver is a fantastic market to invest in. It definitely isn't as affordable as Georgia, but you have a great credit score and enough of a down payment to qualify to get your first property. You can definitely still live for free and even cash flow while living at your property depending on your comfortability with roommates and location. 

It really comes down to your goals. Do you want to live in a specific area?  Are you open to areas outside the Denver hotspots?  What strategy to you prefer?  Rent by room? Airbnb?  Travel nurses?  Long-term tenants?  When are you looking to move? 

If you want the best cash flow, you can find a single family house with a basement apartment, and live in one bedroom, rent out the other bedrooms upstairs, and then Airbnb the basement. It is a little more work with the Airbnb portion, but you will achieve great cash flow, probably $1000+ net cash flow per month over your mortgage.

If you want good cash flow and less work than above, you can buy a 5+ bedroom/3+ bathroom single family house, live in the smallest room, and then rent out all the bedrooms. You will get $750-800 per bedroom that has a shared bathroom, and $850-900 for the master bedrooms with private bathrooms. Net cash flow will be between $500-$1000 per month. Of course, check out occupancy limits in the county/city that you choose.

If you want the least amount of work but lowest cash flow (cover 50-80% of your mortgage payment), I recommend finding a house with a basement/mother-in-law apartment, and live upstairs and then rent out the basement to a long-term tenant.

Denver metro has experience terrific appreciation like most metro markets, and over the last 40 years, Denver averages 5% appreciation, so Denver is a great bet long-term.

I'm more than happy to discuss further if you have any questions.  

Knowing the answers to the questions above will really help narrow down your search and figure out how you can find that first property. 

@Ramiro De Leon Congrats on taking the first step of saving up money and preparing yourself for your first purchase! That's a huge first step. 

Denver is a fantastic place to live, we have 300+ days of sunshine, amazing beer, unlimited outdoor activities and just a super chill and fun place. 

Househacking is a great option since there are lots of ways to accomplish that here too. I've successfully done it personally multiple times and I have clients that have done it as well. 

First step would be to take to a lender to get pre-approved, that will determine what properties that you can look at and what price points. They will be able to determine that based on your income and reserves. You can find a few local lenders here in Denver, or if you need one, I'm more than happy to recommend a few. 

Next step would be to determine which property type fits your goals. There aren't many multifamilies here in Denver, and most of them need work and have trouble qualifying for a VA Loan.

The three best strategies for house hacking right now in 2021 in Denver:

1) Rent By Room - buy a large house (5+ bedrooms/3+ Bathrooms) and live in the master room and rent out all the other bedrooms. This strategy works great because there is a huge need for affordable housing here in Denver and paying 750 for a bedroom is a good deal for people that want to live here but can't afford a one bedroom apartment. With this strategy, you can expect to live for free and make $500-$1000 per month cash flow. It is a little more work in the front end (ie. furnishings, finding 5 tenants, signing leases), but it is worth it!

2) Airbnb - similar to the above strategy, Airbnb is a fantastic one as well since Denver gets a lot of tourists. I've seen clients live upstairs and rent out the basement on Airbnb, so you get the best of both worlds, privacy and your own space while the lucrativeness of Airbnb, so you can definitely live for free or close to it with this strategy. 

3) Combo - you can easily do both strategies if you find a house with a walkout basement or separate entrance to the basement, and if you and your significant other are willing, you can Airbnb the basement and then rent out the rooms upstairs. This strategy you will probably cash flow the most at over $1k per month, but it would be the most amount of work, but worth it for the right people.  

You are in a great position, and Denver is a fantastic place to live and invest. 

@Tiamo Wright That's true, it is much harder to rent from Nov-March in Denver metro. 

A few questions: 

Is this house furnished already?  That will be a huge determining factor for travel nurses or a corporate rental or Airbnb model. 

Is it your primary residence? If you want to Airbnb this property, the city of Denver only allows it if it is your primary residence. 

1) You can easily find tenants to rent it long-term if it shows well in pictures, you could start marketing it now and find someone by 1/1/22. The best tenants start planning and looking ahead 30-60 days before their lease expires. 

As you know, you won't get the same amount of interest right now compared to the spring and summer months, so you could easily do a 4-6 month lease to start with the new tenant, and then raise the rents to market or re-rent it during the prime rental months of April-August when there are way more people looking to move. 

2) I wouldn't let your place sit vacant since it sounds like a wonderful home, and there is still a lot of demand for rentals, especially detached single family homes.

3) Most travel nurses rent studios and one bedroom type places/basement apartments since they don't need all that space, but it wouldn't be that impossible to find 4 travel nurses, maybe a little more work on your part. 

@Moses Rendon-Boardman Congrats on closing our your first primary residence!  You are well on your well to financial freedom in the next 3-10 years!  Like Bryan mentioned, definitely attend those meetups, that is the best way to meet other likeminded investors. 

@Joe Garretson Congrats on taking the first step to recognizing your end goals and finances!  Those are two big steps!

Have you thought about buying a primary home in Castle Rock, especially since you want to wait till your kids graduate high school to travel with your wife?  That gives you plenty of time, and there are so many low down payment loan options right now, it is a fantastic time to buy, especially during the winter months when less people move. 

Nothing wrong with buying out of state, but I like buying in your backyard, especially if you don't own a primary residence yet.  

Long-term cash flow won't be as good as Green Bay, but if you plan on holding it for the next 7-10 years (or until both kids graduate), you will be happy that you did because you will still get nice appreciation over that time (Denver metro areas 6% per year over the last 40 years). 

@Chip Martin Those books are fantastic place to get started!  I wouldn't give up on Denver entirely since you live here and it is easier to manage than any out of state market (unless you have strong relationships in those markets). There are still deals out there that work if you are a little more creative than the next investor. It really depends on your goals. 

If you are open to creative strategies such as rent by room, Airbnb, mother-in-law apartments, etc, you can still cash flow here in Denver. Rent-by-Room is one of my favorite strategies since you can buy a large single family house and rent it out by the bedroom vs. renting the whole unit out, you can get 1.2 to 1.5x rents by doing that strategy. It works best in suburbs that allow the most unrelated parties and reasonably-priced homes such as Arvada and Lakewood. 

Also, both Arvada and Wheat Ridge allow Airbnb rentals, even as investment properties (laws could change in the future though), but that is another strategy that could cash flow well if managed properly since Denver metro has really good tourism in the spring and summer months.  

@Jay Gil It really depends on your goals. Those are all great suburbs to invest in, but have you considered the cities Arvada, Wheat Ridge, Lakewood, and Westminster?  Those are some of the other suburbs around Denver that have properties in your price range of under 600k and still near good to great schools. 

The historical average appreciation over the last 40 years has been 6% per year in Denver metro (which includes Littleton, Highlands Ranch, and Parker and those cities listed above). Since this is an investment property and a 10+ year buy and hold and first investment property, have you thought about spending a few days here looking at different neighborhoods, rent ranges, trends, etc? 

1) All of the cities that you listed would be a great buy and hold investment property since those cities are very popular suburbs. 

2) See above, again, it really depends on your goals. You can definitely achieve higher cash flow in other Denver metro suburbs and similar appreciation. 

3) You are not too late, there is still opportunity for investors here, and Denver metro is growing and lots of room 

@Frank Basile Welcome to BP! That's great you were able to save up 35k, which is a fantastic place to start and you can utilize a low down payment mortgage.

Denver metro has a lot of great pockets that work for your goals with price and proximity to the mountains and the city such as Lakewood, Wheat Ridge, Arvada, west Denver (west of I-25), Westminster, Thornton and Northglenn. In all of those cities, you can find single family houses between 400-500k with 4+ bedrooms and 2+ bathrooms. 

Regarding a separate detached ADU in Denver, they aren't as common as you see in Los Angeles. In fact, they are extremely rare here since the cost of construction, permits, time, etc makes it tough on most homeowners.

Have you thought about a house with a separate entrance to a mother-in-law apartment, basement apartment, etc?  Those are the best ones to consider with your goals in mind. The important things to consider are finding a single family on a multifamily zoned lot, number of parking spaces, number unrelated parties allowed in that city/county, and overall lot size (for future development).  

Those types of properties give you multiple options to utilize the rent by room strategy, Airbnb, rent to a long-term tenant, or a combo of two of those strategies depending on your comfort level and time.

If you want the best cash flow, you can find a single family house with a basement apartment, and live in one bedroom, rent out the other bedrooms upstairs, and then Airbnb the basement. It is a little more work with the Airbnb portion, but you will achieve great cash flow, probably $1000+ net cash flow per month over your mortgage.

If you want good cash flow and less work than above, you can buy a 5+ bedroom/3+ bathroom single family house, live in the smallest room, and then rent out all the bedrooms. You will get $750-800 per bedroom that has a shared bathroom, and $850-900 for the master bedrooms with private bathrooms. Net cash flow will be between $500-$1000 per month. Of course, check out occupancy limits in the county/city that you choose.

If you want the least amount of work but lowest cash flow (cover 50-80% of your mortgage payment), I recommend finding a house with a basement/mother-in-law apartment, and live upstairs and then rent out the basement to a long-term tenant.

Denver metro has experience terrific appreciation like most metro markets, and over the last 40 years, Denver averages 5% appreciation, so Denver is a great bet long-term.

Zelle, Paypal, and Direct Deposit.

@Connor Ryan Hi, yes, I've done that here in Denver metro as well as many other investor friends of mine.

Denver metro is a market that has a lot of opportunity and you can still cash flow as long as you are within 20 minutes of downtown Denver. There are lots of great areas to invest in, especially if you are a long-term buy and hold investor. 

One sweet spot is finding a property that is single family that has a mother-in-law apartment, basement apartment, or a separate entrance to the basement. It gives you multiple options to utilize the rent by room strategy, Airbnb, rent to a long-term tenant, or a combo of two of those strategies depending on your comfort level and time. 

If you want the best cash flow, you can find a single family house with a basement apartment, and live in one bedroom, rent out the other bedrooms upstairs, and then Airbnb the basement. It is a little more work with the Airbnb portion, but you will achieve great cash flow, probably $1000+ net cash flow per month over your mortgage.

If you want good cash flow and less work than above, you can buy a 5+ bedroom/3+ bathroom single family house, live in the smallest room, and then rent out all the bedrooms. You will get $750-800 per bedroom that has a shared bathroom, and $850-900 for the master bedrooms with private bathrooms. Net cash flow will be between $500-$1000 per month. Of course, check out occupancy limits in the county/city that you choose. 

If you want the least amount of work but lowest cash flow, I recommend finding a house with a basement/mother-in-law apartment, and live upstairs and then rent out the basement to a long-term tenant.

It really depends on you and your partner's goals. Denver metro has experience terrific appreciation like most metro markets, and over the last 40 years, Denver averages 5% appreciation, so Denver is a great bet long-term.