All Forum Posts by: Kenny Smith

@Amit Rana

I would agree with everyone here!  Comes down to what your cash on cash return is, your current interest rate on the place, and what other cash flowing opportunities are out there right now with current rates.

Also, if you're house hacking this place..I would consider looking at a HELOC instead of a cash out refi. Talk to your local credit union about this option. What's great about a HELOC is you only pay interest on the money you take out, so it is not a lump sum.

Once you get approved for it, the money is now readily available when you need it.  And can be used for another deal if something comes along.

Best of luck!

Kenny

@Roman Puzey

To Dan's point, getting a great CPA is critical as you start to build your portfolio.  I would definitely contact one ASAP.  Also, talk to one about doing a Cost Segregation Study.  Essentially it is front loading your depreciation instead of taking it out over 27.5 years.  This could be a good option for you, but again, a good CPA can walk you through all of the intricacies of what your options are.

Best of luck!

Kenny

We've done very well catering to travel nurses via MTR's the last few years.  

What is everyone's long term outlook on this strategy, and do we foresee travel nurses going to continue to be a healthy tenant market to cater to?

Thanks for sharing!

@Ellen Olson

Can't go wrong with these 3!

1. Rich Dad Poor Dad by Robert Kiyosaki

2. Set for Life by Scott Trench

3. How to Invest in Real Estate by Joshua Dorkin and Brandon Turner

Best of luck!

-Kenny

@Austin Berlick

I'd agree with Christoper here!  We buy all of our appliances from an appliance store called Appliance Factory here in Denver.  They don't really promote it, but just ask them for ONLY scratch and dent options.  Our stores here classify the scratch and dents into grade A, B, C, and D.  D being in the worst shape and biggest discount, and A being in the best shape and the least discount.  What I've found is that some of these scratch and dents are in very inconspicuous spots as it is, and I'm happy to buy an appliance with a dent where nobody can see it for 30% off.

To Christopher's point, these units will get scratch and dented at some point anyways!  Cannot recommend this strategy enough.

Best of luck!

-Kenny

@Petronella Kerssens

Great question!  I get this question from a lot of clients, and it can really come down to looking at just a couple things, and a couple of questions you have to ask yourself of what your financial goals are long term.

1. What is your cash on cash return for the 1, and what is it for the 2?  I.E. after expenses, what are you cash flowing on the property, and what is the total percent of the money you invested you can expect back each year from that cash flow.

2. What is the average appreciation for the properties in that area?  Or, to get even more gradual, what would be the average appreciation for the type of properties you're looking at?  Your realtor should be able to help you with this.

3. Lastly, based off of these 2 questions, what is your Net Worth ROI? Or, your cash on cash return, plus your appreciation in these homes should be able to give you your answer.

More times than not, you are going to see a better ROI on investing in multiple properties. And it really depends if you'd sell these properties down the road, refinance them to buy more, etc.

You should also talk to your Realtor about what sellers are willing to offer in your market when it comes to temporary buy downs the seller is willing to cover via a seller credit.  That is how I've been helping my buyers stomach these rates and buying them time to hopefully refinance if and when rates go back down.  Never a guarantee though.

Best of luck!

-Kenny

hey all, this event has been CANCELED last minute.  My fiancé tested positive to COVID about an hour ago, and I feel it would be irresponsible of me to host this meetup.  For that reason, I am going to have to cancel.  I hate to do it, but I simply won't have time to get a last minute test done.  So sorry for the inconvenience.

@Hansel Gunawan

It really all depends on what is in the HOA's bylaws. Some may not allow something like this, and some do. Some have minimum lease periods and some don't. It is really important you double check with your HOA before doing anything. If not, you could get yourself into a mess.

Best of luck!

@Nilusha Jayasinghe

I agree with everyone's input here.  I run a couple of these types of properties in Westminster.  Yes, stoves are against code if it is not zoned R-2.  Putting a second stove downstairs really depends on what you are comfortable with or not and if you are willing to go against code or not.  Technically, it is illegal.

As stated, if a stove is not allowed, then have them provide what is allowable, such as a hot plate or counter top stove.

Lastly, where people get hung up in converted their home into a non-conforming duplex, is not having the accessibility from one unit to another.  It is a grey area for sure, but if you decided to wall off the upstairs to the downstairs, you have now converted it into 2 completely separate units making it a duplex.  If it is not zoned R-2, this is illegal.  However, having a door in between the 2 parts of the home would be the same as renting out a room.  Again, there are grey areas here, but I would have the building department walk you through what you can do.

Shoot me a DM, and I'd be happy to walk you through it in more detail if need be.

@Mary Larson

If you are the seller, at least here in CO, you don't have many outs in the contract. If you are pertaining to the closing documents for the HOA, the Title company should have gotten that together. If they can't get the documents in time for closing, they should do an amend/extend to push closing until the documents are in place.

If they try to bail on closing because of this issue, I am not an attorney, but this sounds like there are means for the buyer to sue the seller if they chose to do so.