All Forum Posts by: Spencer Abeyta

I think Colorado Springs has always been a great appreciation market and now with soaring prices from bidding it is squeezing cashflow very tight. I don't think you will find big cashflow numbers unless you work magic off market or have owned the property for a couple years. 

I'm not saying you can't find cashflow, I'm just saying if you want to find a house on the MLS under 300K, expect multiple offers and you need to have extra cash for an appraisal guarantee. It will be much harder to cashflow where you have to pay top dollar for a property and potentially have to pay out extra money if the property doesn't appraise.

Hello @Travis Arguello, welcome to BP! Congratulations on pursuing a real estate license. I passed my test in January and I thought the State part of the test was more difficult than the National part. The section with the most questions are as follows for the test:

State

1. Colorado forms and contracts

2. Requirements governing licensee activity

3. Brokerage relationships

National

1. Contracts

2. Practice of real estate

3. General principles of agency

I hope that helps you narrow down your studying some. Good luck!

Hello @Maria Palomino, I'm not sure where this property is located, but you've found yourself a 2% deal according to your numbers. That means the cashflow is great but I wonder what kind of neighborhood it is in. Traditionally, you don't find 2% deals in the best areas. If you are comfortable with the area and a property manager with experience has given you the greenlight, I would pull the trigger. I don't think anyone would be complaining about almost $900 of cashflow on 27k invested assuming all other factors check out and you are comfortable.

Hello @Peter Pham, welcome to BP! From the stories I've heard, you are in a crazy market up in Denver. If you could list a home you will be well on your way to a nice paycheck, then you have to figure out how to repeat it :). I like just down the road in Colorado Springs and if you are interested in my market at all I'd love to connect and talk about it.

Hello @Diego Albany, first off, congratulations on being interested in investing in real estate. Second off, do you have a job? If not, go get one ASAP. I say this part jokingly part serious because it is a lot easier to get into a house to house hack if you have money to put down and will qualify for a loan. 

As for house hacking advise, the best property you could find is a 2-4 unit home so that you can qualify for FHA financing or just a low money down primary home loan. From what I understand these properties are in high demand everywhere. So you have to make yourself stand out or settle on a close second best option, a single family home. I know people like small multifamily because they are separated from people they are renting to. But if you have a couple of trusted friends with jobs I find that renting out on a per room basic works just fine.

Find a way to bring value to the table and that will help make it more appealing for people to help you out. I started out in real estate around your age and I found people think that teenagers don't know what they are talking about, which is mostly true :P. But if you can educate yourself and be a sponge with information at your age, your will have a long and successful investing career ahead of you.

I would recommend looking for a partner to go in on the deal together with. It sounds like you want the deal to be 100% yours, which is completely understandable :). But its better to have part of a great deal than let the deal slip through your fingers.

As for creative financing, do you have any friends and family that would be willing to loan you the money? 

If it's a duplex, do you have the option to move in? If you move in you might have access to and FHA loan which only requires 3% down, assuming the property does not need a lot of work.

Welcome @Pardes Seleh and congratulations on having your real estate license! The MLS is a great way to run accurate comparables and the more you know about your market the more valuable you are.

@Pete Silan I would be careful with any sort of gender specific housing for a small time landlord because it is very easy to encroach on Fair Housing Laws. Sex is a protected class under fair housing. My advise would be to just put the unit for rent and not include any stipulations of who you want in the property. Have a uniform screening policy for all potential tenants and set base criteria that must be met in order for the applicant to be accepted. 

When I rented an apartment for college I found one year leases to be the norm as this gives students a full school year in one place. Now occasionally a 6 month lease was used in cases where a student only had one more semester to complete. 

Personally, I don't believe there is a noticeable difference between condos and townhomes when it comes to renting to students. In a college town students would be used to living in close proximity to other students. As long as there is adequate parking I don't believe there will be any problem except for potential noise complaints.

Hello @Joseph Stamper, I've taken a look at long distance investing as well. You are looking in the right areas, Tennessee, Arkansas, and Ohio are great for cheaper properties. Just keep in mind a duplex under 100K will almost never be in the best condition in the best neighborhood. That being said, if you are comfortable with where it is located and the number work, I would go for it. Finding a great agent and property manager are two key components to making a deal like that work so I would focus on finding those two people ASAP.

That's a great idea @Johnny Encinias, take it a step further and rent out a room or two to friends and see if you can live for free. As you know, housing is usually the highest expense and if you can minimize that it really helps set you up for a good financial future. If you live in the property for 2 out of the 5 past years (this does not have to be 2 year continuous) you can sell the property and avoid paying capital gains on up to $250,000 if you are single, $500,000 if you are married.