All Forum Posts by: Alexa Ferguson

Hi Trevor, I'm happy to help! Just sent you a DM.

Hi Hansel! I think the best way to get started in real estate investing is to house hack. You can put the smallest amount of cash into it and reduce your living expenses drastically with this strategy, so to me, it's the best first step to take to set you up for success for future investments. I have lived in 3 houses over the past few years and house hacked all of them - all single family homes. Reasonably priced multifamily properties are hard to come by in many markets (I am in Denver and that is the case here), so SFH is the more affordable option. By making it your primary residence, you can put as little as 0%-5% down, depending on the lending program. We look for homes with a space that could be separated so we don't have to share space with our tenants. This could be a basement, upper level, wing of the house, apartment over the garage, etc. - any part that can be accessed separately. Denver homes commonly have a separate entrance to the basement, so that is the form ours take. You can then rent this space out as a long-, medium, or short-term rental, based on the strategy you like. We do STRs because they generate the most cash flow and are allowed in our area. We have consistently covered our mortgage for the past 3 years using this strategy! After living in the house for a year to satisfy the primary residence lending requirement, we move out and rent the entire house to start cash flowing. We are on house #3 now and cash flow about $60k/year in total. Happy to talk about Denver or general strategy more if you'd like! 

Hi Brandon! I have lived in 3 houses over the past few years and house hacked all of them - all single family homes. As you said, reasonably priced multifamily properties are hard to come by in many markets (I am in Denver and that is the case here), so SFH is the more affordable option. By making it your primary residence you can also put as little as 0%-5% down, depending on the lending program. We would look for homes with a space that could be separated so we didn't have to share space with our tenants. This could be a basement, upper level, wing of the house, apartment over the garage, etc. - any part that can be accessed separately. Denver homes commonly have a separate entrance to the basement, so that is the form ours took. You can then rent this space out as a long-, medium, or short-term rental, based on the strategy you like. We do STRs because they generate the most cash flow and are allowed in our area. We have consistently covered our mortgage for the past 3 years using this strategy! Hope that helps!

Hey Nick! I own several short term rental properties and work for a real estate brokerage that specializes in vacation homes. Your plan is great!

There are varying opinions on this, but I would recommend buying your first investment property where you currently live. A house hack would be ideal for this since you can put as little as 3.5% down for your first house. If you went straight to buying an investment property (not your primary residence), you would likely have to put 20% down. Buying where you live would also allow you to self-manage your property much more easily than if you were out of state, so you can get the hang of it while you are close. I would recommend renting the property out when you move, but if you decided to sell in a few years, that would not be a problem.

If you don't want to house hack, you can definitely buy the vacation rental first and keep renting (many people do this who want to stay living in a downtown area, for example, but can't afford to buy there). The cash flow from your STR would likely even cover a portion of your rent! You would just need to put down 20% instead of 3.5%, so it depends how much cash you are wanting to invest or keep liquid.

Hope that helps! I’m based in Colorado, but always happy to help.

Hey Eric! To get the best return on your money, I would recommend purchasing a short-term rental - these generate significantly more cash flow than long-term rentals. This could also be a great option for you since you spend a good amount of time in Colorado, so you can use it whenever you'd like rather than having a tenant occupying it constantly. As far as when to buy, it's tough to time the market perfectly since no one really knows what will happen in the future, as much as we try to predict it. Right now competition has dropped off significantly making it much easier to purchase a property, so if you are wanting to get started investing now is a good time. The rest of your questions depend on what part of Colorado you are interested in - are you thinking the Denver area, or somewhere in the mountains?

@Carl Cheung I have done this in the Denver area (existing homes, though, not new builds). A walk out basement works great as a separate apartment for an STR. Self management is easy to do since you'll be living there, though I would definitely still recommend hiring a cleaner and using softwares that automate pricing, messaging, cleaner scheduling and payouts, etc. Since you're building your home, you have the unique opportunity to get ahead of one of the biggest complaints with basement apartments, which is hearing the people upstairs. If you can, try to insulate between the main level and basement as efficiently as you can to reduce noise between floors. I would also recommend making sure you can access the bottom floor from the top floor somehow 1) in case you ever want to stop renting out the basement and 2) so that it is a legal SFR (if you can't access one floor from the other, it may be seen as a SFR with an ADU, which could be an issue depending on your city's regulations). Renting out our basement as a STR, we have always covered our mortgage and lived almost completely for free - it's a great strategy. Hope that's helpful!

Thanks, Sam!

I'm definitely still in the exploration phase to see if I will end up going this route, but as I've furnished multiple units, I've realized I don't really enjoy that part of the process nor is design a strength of mine, so if I can hire it out to someone who will do a better job than me for a reasonable price, I will. To be determined!

Does anyone have a recommendation for a great interior designer in the Denver area who furnishes Airbnbs? 

Thanks so much!

My husband and I own a few STRs in the Denver area that we self-manage. While we live in the area, our goal is to make these STRs as self-sufficient as possible so that 1) the cash flow they generate becomes increasingly passive, and 2) we feel confident investing in STRs out of state, which we’d like to do in the future. For us, the following softwares have proven useful in making our STRs more hands-off:

- Pricing Tool: PriceLabs - dynamic, data-driven pricing tool that auto-updates your listings, optimizing income and occupancy by adjusting prices based on market data and trends.

- Cleaner Scheduling Manager: TurnoverBnb - automates scheduling and paying cleaners at its core, but can also systematize guest check-out and reviews.

- Channel Manager: Guesty - allows you to list your STR on multiple platforms (Airbnb, VRBO, etc.) and manage it all from one place.

Hopefully this info is helpful, and I’m happy to answer any questions on self-managing STRs.

I'm also curious - have you all had success with any other STR management tools/softwares?