Cashflow on House Hack / Duplex in Denver

[AJ Stanis]

Hi Everyone,

I am looking to possibly buy a duplex or triplex to house hack in Denver (live in one unit and rent the other(s)).  But, based on what I am seeing, the rent from the other unit(s) would not even cover the % share of the mortgage and the entire building would not cash flow if I moved out.    The asking prices seem higher than what market rate for rents can command, and it is more money per month to buy a place than to rent similar.

Am I just seeing bad deals or this normal for Denver? 

Thanks!

AJ

[Scott Trench]

Hi AJ! Welcome to BiggerPockets! As a fellow Denver investor, I can say that yes it is tough out there. 

A couple of things: 

1) Don't look at the units for sale right now. Look at what has ACTUALLY SOLD in the last 90/180 days instead. That's representative of reality. Active listings are often the properties that are overpriced or which make no sense. The good deals last minutes, hours, or maybe a week at most. So if you look at active listings you will get discourage quickly. 

2) I see 36 duplexes, triplexes, and quadplexes that have sold for between $350K-600K in the last 180 days in the Denver metro area. If zero of these properties meet your criteria and there are no single family homes that you'd be willing to rent by the room with a similar search, then you should rethink real estate investing and house-hacking as an approach here in Denver, and either invest elsewhere, or choose another asset class.  I bet you, though, that you will identify a handful of 2-4 unit properties that might have made sense for you, and perhaps dozens of single family rent by the room properties that might have worked if you start with a backward facing look. 

3) Once you have determined what you WOULD HAVE bought, if you had the opportunity, connect with a local agent (we have the "find an agent" button at the top if you don't know any agents or want to specifically connect with an investor friendly agent to help you) and ask them to set up a search that meets your criteria. Get your preapprovals, and be prepared to REACT, quickly, to a good deal that meets your criteria when it hits the market. 

Hope this helps!