All Forum Posts by: Ian Whitney

Hi Cole-

If you're starting out, I'd say the best place to invest is where you live (or where you have lived).  I currently have 24 doors across 5 buildings here in Denver, and the key to starting out is finding value where others don't see it - which requires you be on the ground in the market where you are investing.  Books and reports focus on the quant side of things (and Brandon's are good books), but only by driving and visiting can you get a read on the qual side.

There's the allure of smaller price tags offering higher CAPs, but when you factor in the economic risk (which is why the price tags are smaller) and the risks of remote management (which are significant) it doesn't seem worth it - at least to me.  It feels a bit like the penny stock approach to the stock market, which fails far more often than it works.

Down South, Colorado Springs is a bit over heated and there's some real garbage, though I've seen some interesting opportunities in Colorado City. Fort Collins isn't bad, though it's getting close to Denver pricing based on Boulder proximity - and Denver is stronger. Greeley has been on a tear and it's a boom/bust oil town so I'd avoid that for the moment. If I were starting, I'd take a hard look at Englewood where you can get Denver rents at a discount per door. Depending on your situation, best way in is to house hack a duplex or SFR with an AirBnB angle (present craziness aside).

In terms of next steps, get yourself an underwriting template and practice evaluating deals you see on the MLS. It's not difficult, and it's a practical necessity if you're looking to get into investment real estate. For properties that look good on the numbers, drive them and practice evaluating neighborhood and condition.

Best - Ian

Can anybody recommend a good portfolio lender in Florida, or one who lends in a Florida? Not interested in brokers, interested in banks. Thanks. 

My advice would be to stick with what you know, Des Moines is a great market!  I'm sitting in Denver looking at where I should go, and Des Moines is a top contender.  If you want to be successful in real investing, don't chase the money - be there when the money arrives. 

https://www.desmoinesregister.com/story/news/2017/03/23/des-moines-fastest-growing-city-midwest-census-says/99502922/

I like to consider myself pretty good :), but happy to further refer among my team at MODUS if they really dial in on a neighborhood. 

ADU is likely the better play as you can Airbnb to maximize rent. Denver won't allow you to do that with a duplex. They're pretty rare but you do find them. You are, however, going to need a bit more money to get into a multi-door in today's market (450ish in a sub market, 550ish in Denver depending on beds) and inventory is pretty thin so deals bid up. I'd go single family detached as a starter, run up equity for a couple years and then make the jump into an ADU or duplex - or keep it as a rental and bounce into another single family (different route to two doors). So circling back to the original question, the sooner you can get into a "good" deal the better. You need to start the equity clock ASAP.

Check out Housing Helpers on 29th Ave in Denver. They helped me years ago when I moved to Boulder. Lived in Chicago too, Lakeview. You’ll like it out here. 

My recommendation would be to trade up in asset class.  Trade your C into a B+/A-. You might take a little hit on the return, but nothing like the taxes.  I have access to some multifamily pre-market listings, brand new, great neighborhoods, should perform around a 5.5CAP.  I've also got a couple of off-market lower income plays that are not in Aurora, so there is a lot less brain damage.  I've also built out a single family strategy that I've begun working with some of my clients and it looks very promising.  I have 20 doors here in Denver, so I'm an investor first, but I'm also licensed as a broker to facilitate transactions.  PM me if you'd like to have coffee and chat, I'm confident your challenges can be solved.

I’m happy to help you navigate Denver, Lisa.  I’ve got 20 doors in the area, and frankly it’s getting to be a pretty tricky market as prices and interest rates continue to climb. Returns are pretty thin, and inventory is really low, but you can still find deals if you know what to look for. Send me a private message if you’d like to have coffee and chat. 

I moved to Denver from SF, and really enjoy it.  Denver has better weather, truly.  I also 1031’d my mother out of a 3CAP 4 plex in Berkeley (talk about regulatory market) into a 12CAP 10 unit here in Denver a couple of years ago.  Those days are unfortunately gone. At the moment, things are trading around a 5.5CAP which is still better than most of Cali.  If you want a better return, a lot of the money is moving to Kansas City.  For reference, on the smaller stuff in Denver (2-4 units) you should expect to pay $250-$350 a door depending on condition/neighborhood. Larger stuff (6-12 units) you are probably looking at $150-$200 a door.  Best hack is an up down that allows you to AirBnB (won’t work with duplex given Denver regulations) that gets you max return, price tag for something you’d want to live in is probably high 6s/low 7s.

Lots of broad stroke discussion at the national level, which is good for general principal, but if you're interested in discussing the more granular market specific aspects of Colorado - please post here.