All Forum Posts by: Shawn McMahon

Pah!! Thanks for the heads up. I'll retweak that sentence. 

Sounds good. How do you follow up if you have been only sending out replies from craigslist ads? 

Here is my resume. Critique away please!

Please note I don't have any previous work experience in RE.

Right now I want to work underneath a broker while I am working on my getting my Brokers License.  

1. Where in the Biggerpockets forums can I find Agents that are looking for assistants? Would that be the BP Marketplace? If so, how do you search the BP marketplace forums so I can find only those posting for the Denver area? 

2. Is it common for agents to compensate assistants on an hourly 1099 wage while they are training? I want to dive head first into RE but I need a source of income while I am studying and working under a broker. I can't go without working while I study for my exam. 

Oh wow, you are right. What I heard about the light rail was from the previous owner so I didn't check to see if that was correct. 

My plan for now is to stick it out for the next 3 years. If the home appreciates in value to the point it will cover the grant money I need to pay back, plus some, then I sell the property and move out. If it remains relatively the same, I'll attempt to rent it out to tenants. 

Thanks for the congrats! It is pretty much in the middle off of 112th and Huron, fairly close to 1-25. There is a park and ride on 120th and Huron/Melody that is about a mile away. It is scheduled to be a light rail stop sometime in the next 2 - 4 years, so that may help add value to the property. 

I actually have been looking into Air BnB. Could I rent out to multiple air BnB guests during the month?  I remember signing a document at closing saying I wouldnt not rent it our for more than 30 days, so that must mean I can rent it out at my leisure for days at a time? However finding multiple "tenants" each and every month to meet a mortgage does sound like a challenge. 

Just last month I purchased my first property in the Denver Area! It is a very exciting time. My partner and I purchased a 1 bedroom condo together for $154,500 in Northglenn, CO. We used FHA financing so this will be our primary residence for at least 3 years, according to the terms of the loan.

The bond program I used through my lender covered a considerable amount of the closing costs. I was given a $7,586 grant that went towards the 3.5% down payment and closing costs. We bought the home at the asking price and negotiated to pay half of the closing costs, not all of them. 

Price: $154,500, Sq Feet: 890, 1 Bed/1Bath, 1 Car Garage

30 year Fixed Rate Interest: 4.5% 

Taxes: $1192/year , $99.33/Month

HOA: $1800/year, $150/month

Principle, Interest, PMI: $873.48/month

Total Mortgage Payment: $1122.81

Earnest Money: $1500 

Inspection: $250 

Appraisal: $450

Home Warranty: $175 

Closing Costs: $22.80 (Left over money from $7,568 grant after down payment covered a majority of the closing costs) 

Total Money in the Game: $2397.80

My Half: $1198.90

Partner's Half: $1198.90 

Since it is in FHA loan our lender told us they MIGHT come after the $7,568 grant if we ever sold the property or rented our the property within the first three years. His emphasis on the word "MIGHT" kinda through me off. Sorta implying that this could be done without them finding out. Has anyone else attempted this?

I was kinda bummed that we ended up with a 1 bedroom. I was approved for $200,000 by the lender and everything in that price range wasn't very appealing in the Denver market as of now. Since this our primary residence I was more concerned with find a place I enjoyed rather than living in a 3/2 property that cash flows. 

We don't plan to live in this condo long term, so I would like to rent it out once the 3 years is up. However, I believe that would be difficult being a 1 bedroom. I'm not sure I could get more than $1300/month? Although rents have been increasing quickly in the last year, I'm not sure that will be sustainable three years down the road. We only have spent $2397.80. If I can cash flow $100/month that would be $100*12/$2397.82 = 50.04% ROI? (Not including future expenses, repairs, and upgrades)

In short, am I calculating the possible ROI Correctly?

Was this a good deal?

Do you think I'd have trouble cash flowing a 1 bedroom when the Denver market as cooled off? 

We met with an agent yesterday. As we already stated, given the amount I am approved for the inventory selection at the moment is already really low. Pretty much the only options available are Condos/townhouses or a poor condition single family homes. There are deals out there they just got quick and often get bombarded with cash buyers immediately. 

My partner and I are considering waiting a 3 - 6 months. As of right now, I am the only one applying for a loan and I am not approved for very much. My partner has sold a home within the past 3 years with an FHA loan. Since it has not been 3 years since he sold the house, he can not be added to the FHA loan according to my lender. Of if he does, it will hurt the amount we qualify for, one of the two. If we wait until November I can take out a loan with my partner instead of by myself. Our lease is up in July, so we are considering living with a friend from July - October and saving as much money as we can to afford 5% down instead of 3.5% down. This worries me a little because the more we wait, the more potential the market has to go up, the more we are missing out on, and even less inventory will be available. However, if we do wait and take out a loan with my partner, the duel income may help us get qualified for more and we will be able to put more money down, making our monthly payment less.

Do you think waiting 6 months would be a smart or bad move on our part? 

I am not an agent so I don't have immediate access to the MLS. I am currently looking into becoming an agent but I don't want to wait the amount of time it requires to obtain the education to purchase a home. What other ways to find homes that have just hit the market?

I do agree with you Linda, I think Denver is close to the peak of its run with prices. If this is the case I run the risk of becoming underwater on the mortgage and getting myself essentially stuck in a property I don't want to be in long term. Also if rent has hit its peak it might negatively cash flow if I try to rent it out. I don't want to be stuck in a property but I also don't want to keep paying these outrageous 1BR/2BR apartment rental prices when I can have a home of my own for $100 - $200 more a month and actually own the asset in the long run. 

Hello Everyone, 

My partner and I are looking at buying our first home in the Denver area. Right now we are sick of Denver's rising rental rates and we think buying a house would be a smart idea right now. We've talked to a lender and I am currently qualified for 190k, 3.5% down FHA loan. Mortgage with taxes and insurance would be around $1350/month. Currently we are looking in the Broomfield/Westminster/Thornton/Arvada area but are open to other areas. Some concerns I have been thinking about:

1. I currently have a job in Denver, so I plan to be here for the next 3 - 5 years at least. However I do plan to move out of state eventually. After 3 - 5 years I would plan to either sell the house or hold onto the property and rent it out long term. Since I am only qualified for 190k the availability for single family homes in that price range is slim. On top of this, many homes in the Denver area do not cash flow well due to rising property costs. 

Current Denver area investors, what wisdom can you share about buying a home in the area at this time? 

Wish I wasn't working! Ill be at the next one. I'm excited to see these going.