CASH FLOW PROPERTIES

CASH FLOW PROPERTIES

Real Estate · Pueblo, CO · Member since 2015 · 1 post · 0 votes

Both 2015 and 2016 were great years for flipping properties in Colorado.  However as the prices went up and the inventory got tighter it became harder and harder to find good buys, even at the Foreclosure sales.  As a realtor that works with investors this was a real concern to me.  I live in Pueblo Colorado which is about 90 miles south of Denver and 35 miles south of Colorado Springs.

     A good friend and client of mine, continued to purchase properties at these higher prices.  He would keep them for rentals and is generating himself a very nice monthly cash flow.  He now has over 80 rental properties . . . all of them cash flowing!

So I started running some numbers on the properties that are listed under $100K and found out that even paying the list price for these properties they would cash flow. I just put together a PDF booklet with over 40 properties here in Pueblo that are all prices below $100K that will cash flow between $150 and $425 per month depending on the property. There are even a couple of duplex units in the list! And if your a buyer that puts alot of faith in knowing that the property you are purchasing has a good CAP rate, these properties have cap rates between 8% and 21%!

     I then tried to do the same with higher priced properties, and it was much harder to find any listings that would be asured to give you a positive cash flow at market prices.

     Try this out in your area and see how it works.

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Lebanon County, PA · Member since 2015 · 49 posts · 6 votes
9y

@Jerry Burns 

This is my strategy as well. I try and find properties under 100k. They are more than likely going to cash flow pretty well. Better yet, find the ones that are under 50k or 60k and only need minimal repairs to make them tenant proof. Its not hard finding properties on the MLS in my area that will have positive cashflow at the asking price. It all depends what your strategy and cashflow target numbers are. Most times these properties are in rougher areas and tenants could be an issue.

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  • Investor · Pueblo, CO · Member since 2012 · 96 posts · 63 votes
    9y

    Are you willing to share that PDF booklet by any chance?

    I'd love to take a look!

     - Sam

  • Investor · Bethel, AK · Member since 2013 · 1k+ posts · 852 votes
    9y

    @Jerry Burns  Jerry I have some properties in pueblo. Can we connect??  RR

  • Investor · Northshore MA · Member since 2015 · 29 posts · 16 votes
    9y

    Jerry,

    I think this is a great observation and good advice, depending on someone's strategy. My recommendation in this type of endeavor is to always check your numbers. Double, triple or even quadruple check the properties vacancy, estimated monthly repair costs, and capital improvement requirements the properties has had, currently needs and will have. Usually, it is a good idea to look at these types of deals as a flip first, run all your numbers doing a renovation and then circle back on your CAP rates to make sure the property still cash flows. We this formula on a regular basis here in Columbia, MO and it has worked for us.

  • Investor · Colorado Springs, CO · Member since 2017 · 65 posts · 5 votes
    9y

    Hi @Jerry Burns would you be open to sharing that PDF? And how often do you update it? 

  • Investor · West Des Moines, IA · Member since 2014 · 5 posts · 0 votes
    9y

    @Jerry Burns I would also be interested in taking a look if you are sharing :)

  • Lebanon County, PA · Member since 2015 · 49 posts · 6 votes
    9y

    @Jerry Burns 

    This is my strategy as well. I try and find properties under 100k. They are more than likely going to cash flow pretty well. Better yet, find the ones that are under 50k or 60k and only need minimal repairs to make them tenant proof. Its not hard finding properties on the MLS in my area that will have positive cashflow at the asking price. It all depends what your strategy and cashflow target numbers are. Most times these properties are in rougher areas and tenants could be an issue.

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