Is no one investing in Denver anymore?

Question

I have a rental property in Denver I am looking to sell off-market so I reached out to an agent I've worked with in the past in the Metro. When I first spoke with her she said she had a long list of investors she would send the deal out to and she was confident it would get snatched up quickly. After a few days, I checked in with her and she said no investors are touching Denver right now due to the new inspection/rental permit requirements and I'd need to list it on the market to sell...

Is that true? Is no one buying in Denver right now?

Scott Trench · Answer

No way.

The application and licensing are a very minor pain in the rear. It was like $100 and then we had to schedule an inspection, and the inspector had like two things for us to change at one of my properties. It will not materially change demand.

What it WILL do is prevent you from selling an illegal duplex, as it won't pass inspection, and there is now enforcement for things like egress windows and such.

I don't think any landlord is a fan of this situation (simply because it's $100 and who knows if you get the inspector on a bad day), but it's also not really a dealbreaker for any serious investor or househacker in Denver.

That said, demand IS different nationwide due to the increase in interest rates. But, supply in most places, including Denver is low enough to keep a semblance of balance.

Maybe there is less demand, but the new inspection requirements aren't a major factor, if they are a factor at all.

Matt M. · Answer

I'm buying 2 this month. The numbers have to make sense, and you have to be realistic on pricing.

Jay Hinrichs · Answer

by not listing it on MLS your almost guaranteed to leave a big chunk of your equity on table I would rethink that..

Jeff White · Answer

@Sara R. I agree with others here, I think you need to talk to a few more agents.

Are there investors that are selling because of the rental license requirement?  Sure!

Are people still buying house hacks, new primary residences, and investment properties in Denver?  Absolutely!

Also, I've done the rental license inspection checklist, and it is basically just health and safety items every good landlord should want for their rental units anyway, so it is a minor inconvenience and a small cost every four years.

Denver is still a great place to buy, even with the rental license component now.

Also, as an realtor, my clients have purchased in city and county of Denver in the last few months, so I wouldn't let one person's opinion determine the overall market condition.

Brett Deas · Answer

It is not the licensing that Investors are worried about, its the politics. With the bills going through the state legislatures, I am worried about being a land lord in Denver. With the looming possibility of rent control, the free representation tax, and the possibility of being forced to pay 3-months rent to a tenant you want to raise rent on, it is just getting more and more insane.

Ben Einspahr · Answer

@Sara Reeder so sorry to hear that you have not had any luck getting your rental property under contract. Are people still buying + investing in Denver? 100%! With the low inventory and if priced correctly, home are not lasting long.If your listing agent is saying no one is touching Denver, you need a new agent!

Have we seen a decline on investor interest in Denver County due to the landlord licensing policy in Denver? Not really...

Happy to send you some updated RE trends to help point you in the right direction. Let me know.

Ben Rhodin · Answer

Hey @Sara Reeder! Without knowing the exact details of the property, and what you may be asking for it, I would definitely agree with @Ben Einspahr, there is still a great amount of demand in and around Denver. Sure investment properties have gotten hit harder due to the rising interest rates and buyers not being able to make their numbers work. So as a seller, you may need to readjust your expectations. But I can tell you right now, if the property is correctly positioned, I would have at least a handful of investors, or house hackers that would gladly snag it. I wouldn't necessarily think about avoiding the MLS, but that is your choice. I personally approach it both ways, go off-market to the network first, and if it doesn't manifest before you get to the market, you aren't losing time. Completed sales like this all the time.I would be happy to shoot it out to my database and see what I can do if you are open to it. Ill shoot you a DM.

Jackson Kyhl · Answer

I'm still very active in the market. If the numbers work they work, regardless of market sentiment

Sara R. · Answer

Thanks Ben. I thought it was really strange that an inspection and $50 licence fee every four years would be holding that many people back...

Ideally, I want to avoid the MLS so maybe that's the issue? I don't think the pricing is the issue as I told her there was flexibility. I care more about closing quickly. Where can I go to list off-market deals? She said she had an investor email list, but I'm not sure how extensive it was.

Is no one investing in Denver anymore?

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