Buy and Hold in Colorado Springs

[Ryan Riches]

Investment Info:

Single-family residence buy & hold investment in Colorado Springs.

Purchase price: $260,000

Purchased this 3 bed 2 bath house as a primary residence in 2017. Lived in and rented out our spare bedroom on Airbnb. After just over a year I purchased a second property and moved into it, turning this property into my first true rental property!

What made you interested in investing in this type of deal?

We purchased the house with little intention of it being a long-term, cash-flowing asset for us. We started renting our spare bedroom on Airbnb just to pay off some student loans, and the income nearly covered our mortgage. That's when I discovered bigger pockets and started dreaming about expanding our portfolio and rental income.

How did you find this deal and how did you negotiate it?

We found this on the MLS and worked with a Realtor to purchase the property. We went under contract in November 2017 and competed against 6 other offers.

How did you finance this deal?

We put 5% down and used a conventional loan. We paid PMI upfront to decrease our monthly expenses.

How did you add value to the deal?

We furnished the space and left it as a furnished rental to get above market for our rental rate.

What was the outcome?

Currently cash flowing about $350 a month and have had the same great tenants for 3 years.

Lessons learned? Challenges?

The biggest challenge/learning curve for this deal was outsourcing the maintenance once we moved to Denver. It was not possible to drop by and take a look at something. While it was intimidating to start having plumbers or handymen handle maintenance requests, it freed up a lot of time and stress having to deal with it myself.

Did you work with any real estate professionals (agents, lenders, etc.) that you'd recommend to others?

We worked with Ashton Brooks at Fairway Independent Mortgage for the lending and can't recommend him enough. We also worked with Bet Llavador, now based in Crested Butte. She is stellar if you are looking for a mountain property in the Gunnison/Crested Butte area.