All Forum Posts by: Seth Wilcock

Welcome to BP Nic! Multi Family investing is a brilliant strategy. If you ever want to meet up to discuss financing options, let me know. 

Hi Richard, is the purpose of refinancing your existing property just to free up cash flow on a monthly basis or are you also looking to pull cash out? 

There are low down conventional options available (as little as 5% down when you own other real estate). There are even down payment assistance options available with conventional financing. You don't need to be a first time home buyer to receive the down payment assistance, and ownership in other real estate is OK. 

When it comes to 203k renovation financing, I also encourage you to look at the 5% down conventional Homestyle renovation loan as well to compare. 

If you want to finance a foreclosure with FHA financing. Check out www.hudhomestore.com, type in your city, and see what's available. You don't need to buy the property with cash from www.hudhomestore.com, and you can use 3.5% down FHA financing. Be aware of any MPR's (minimum property requirements) which are required repairs that would need to be done to acquire the property from HUD for FHA financing.

Looking to house hack your first property?  With the conventional HomePossible mortgage, you can purchase a 2-4 family home with as little as 5% down and use 75% of the gross rental income from the adjacent units to help you qualify for the mortgage payment!  Reduced mortgage insurance premiums when doing less than 20% down.  

Credit concerns?  We have you back!  NOVA Home Loans provides free credit services to all applicants through our unique in-house credit services department.

Visit www.coloradoloanofficer.com or call 720-593-NOVA (6682) for details.  Mention this ad and receive $500 off closing costs for BiggerPockets members.

"Bull markets are born on pessimism, grown on skepticism, mature on optimism and die on euphoria.  The time of maximum pessimism is the best time to buy, and the time of maximum optimism is the best time to sell." - Sir John Templeton

Currently, I don't see any indicators that Denver is overheated.  Is Denver a "hot" market?  Yes!  Just because a market is hot, doesn't mean there isn't still room to grow, especially when you consider the market statistics and where we came from in 2008.  If the market tanked in 2008, it makes sense that we will see an even longer recovery and appreciation period.  After all, everything has an equal & opposite reaction.

While this is the first year we have started to see a "slow down" in the Denver market, we are still very much in a sellers market.  We need 6 months of inventory to be considered a balanced market (neither a sellers market or buyers market).  Over 6 months of inventory is considered to be a buyers market.  Consider below.

• 2014: Avg. Sale Price = $358,771 | New & Active Listings = 5,124 | Home Sales = 4,963 | 1.032 months of inventory
• 2015: Avg. Sale Price = $396,749 | New & Active Listings = 5,849 | Home Sales = 5,233 | 1.118 months of inventory | 10.59% YOY appreciation = $3,164.83/mo in appreciation
• 2016: Avg. Sale Price = $438,755 | New & Active Listings = 6,002 | Home Sales = 5247 | 1.144 months of inventory | 10.59% YOY appreciation = $3,500.50/mo in appreciation
• 2017: Avg. Sale Price = $473,273 | New & Active Listings = 5,850 | Home Sales = 4,994 | 1.171 months of inventory | 7.87% YOY appreciation = $2,876.50/mo in appreciation
• Through Sept 2018 (YTD): Avg. Sale Price = $503,497 | New & Active Listings = 5,953 | Home Sales = 4,229 | 1.408 months of inventory | 6.4% YOY appreciation = $3,358/mo in appreciation ($30,224 appreciation ÷ 9 months)

Source: http://www.recolorado.com/pages/market-statistics-...

Increasing interest rates are going to kick some people out of the buyer pool in 2019, and we have started to see some of that already in 2018.  At the same time, 2018 is the first year we have really seen any indication of wage growth in the past 5 years.  Even though interest rates are increasing, people are starting to make more money which means people will be able to afford the increase in rates & home prices.  With wages increasing, we have a long runway of appreciation and inflation ahead, both in terms of interest rates and home prices.  

Affordable housing & entry level homes in Denver-Metro are the real concerns for the years ahead, but there are still plenty of people that can absorb the increase in home prices and interest rates with wage increases.  Increasing interest rates & home prices in Denver has more of a mental impact on people than it does in reality.  Was it less expensive to buy 5 years ago?  Yes.  Will it be more expensive to buy 5 years from today?  Yes.  

Hopefully this data helps you assess the Denver market for your decision. My personal opinion is that Denver is still a great place for a house hack. At the same time, are there great long-term buy & hold strategies outside of Denver? Yes. I think the question you really need to ask, is which strategy yields a better ROI and comfort level? You're in a great position financially, and I think the biggest misstep you can make at this stage is the inability to act on something.

What about a 3% down conventional loan in Denver as a house hack (rent out bedrooms), and then doing a 25% down investment purchase out of state?  There's no reason you can't do both.

Example:

$400,000 purchase price in Denver @ 3% down = $12,000 + closing costs

$100,000 purchase price in another state @ 25% down = $25,000 + closing costs

I definitely think it's realistic to do both with $50,000 in savings.

Hi Dalton,

Congratulations on graduating from college recently, and welcome to the Centennial State!

One thing you may want to consider, is down payment assistance.  In Colorado, CHFA (Colorado Housing & Finance Authority) provides a 4% non-repayable down payment assistance grant, or a 5% silent second mortgage to help lower your down payment.  If you can work seller concessions into the deal to cover your closing costs, you can literally purchase a home with $1,000.  I wrote the following blog post that touches on this subject in case you're interested.

How To Buy A Home in Colorado With $1,000 (Like, Seriously!)

Thank you @PrestonW11. I sent you a connection request. 

Great advice @SoCal_Gabriel! I appreciate the additional info and for pointing me in the right direction. One insurance provider told me it was because the property was located in Indianapolis. The home is not in a flood plain and it is located in the Emerson Heights neighborhood. It is an older home (1926), so maybe that's why? 

Thanks for the recommendation @jaredn20

I'm currently under contract for a $125K duplex in Indianapolis. I estimated homeowners insurance to come back around $90/mo, and I've received two quotes back so far. The first quote came in at $1,880/year and the second quote came back at $2,100/year.

I am an out of state investor (living in Colorado). Could this be why the premium is so high? What am I missing? I get that it's two units with two tenants, but the house is $125K. The insurance is destroying my COC ROI.

I know it's difficult to tell without all the details. I have great credit, and no claims filed in the past 5 years. 

Have you or your husband ever served for the military?