All Forum Posts by: Chris Lopez

@Jared Bouzek - There's a bit more to the story... Once we get the house, we will be spending some time in Denver, then rent it out, and then there's a chance we may be living there when we move out in 2018. Since we live out of state and have a very low DTI ratio, the mortgage broker suggested a second home / vacation loan. I was upfront and clear with my plans to him.

@Mike Olson The property is near Arapahoe and Holly. Yes, I'd appreciate you taking a look. I'll message you the address. My friend and I have been trying to determine fair value it - neither one of us is trying to pull a fast one!

I’d appreciate BP’s opinion on a property. Thanks in advance!

Currently my wife and I live in Los Angeles, CA. We’ll be moving out to Denver in early 2018. The plan is to pickup a property before we move out there. I’ve spent the last month analyzing properties, visiting open houses, talking with a few Realtors, and getting to know the Denver market.

Property: 3/2 house in Centennial (west of I-25). 2 car attached garage, 70’s construction, ~1600 sq ft, updated kitchen and baths a few years ago, new roof 2 years ago. Overall good shape. Move in ready.

Price: It’s an off market deal. A buddy bought this house as his primary residence just under a year ago for 335 (retail/fair back then.) He just got promoted and is now moving out of state. Based on comps, house is worth 355-365. He knows I’m looking and offered the property for what he paid for (335k), which is about what he would make after typical RE transaction costs. 

Numbers:

Rent: $25,200/yr or $2100/mo (PM company gave rent range 2000-2300)

Vacancy: $1260 (5%)

Main: $2,250 (10%)

Ins: $1091

Taxes: $1918

P+I payment: $17,272 (10% down / 4% / 30yr)

cash flow before tax: $1409

cash flow after tax: $1945

My thoughts:

- Cash flow isn’t great, but it cash flows even at 10% down.

- My current investment strategy is to buy and hold. I’ll get active and aggressive once I live in Denver for future deals.

- The house is move in ready with no repairs needed. I’ve stayed at the house before and know it - it’s in good shape. No major work will need to be done for awhile, other then HVAC and water heater are 10 years old.

- After scouring the MLS the last month, I'm not seeing any better deals.

- Solid location. Great school system and lower priced home for the area. If Denver market cools off or corrects, it should still be very desirable.

- It’s an easy deal for me since I’m out of state and have no network there. I’d prefer to not rehab or do major repairs long distance. It’ll save time and sleep for me… which counts in my investment strategy.

- I’ll self manage, other than a PM doing tenant placement. I’ve done this successfully for property I have in Reno. Good properties with good tenants usually require very little work - I don’t mind taking a phone call here or there to save $200/mo.

Thoughts?

I’ll be happy to buy you a thank you beer if you’re ever in LA!

Chris

I wouldn't worry about the vehicle they drive. When I used to work construction, there was the whole range of people: Frugal/thrifty people that drove older cars/trucks and people who always "needed" a brand new truck. There were good and bad people in both types of vehicles. You'll get a much better feel from conversations (learn to ask the right questions) and talking with past clients (if possible).

Jeff, I'll be there. Looking forward to meeting everyone.

Matthew,

What type of info are you looking for? I just moved after living there for five years. I'm in the process of renting out what used to be my primary residence in northwest Reno.  Happy to pass along any info that I know.

Chris