All Forum Posts by: Mark Ferguson

 I think that is what I will do as well

 I am not sure counting on prices to almost double in five years is a good long-term strategy. Certainly is nice, but I would never count on that. 

 That's not a bad gain!

 That is what I see too. The unknowns are when and what the national economy does, which will affect us as well. 

Somehow I stopped getting notifications on this thread when people replied. Sorry @Russell Brazil @Kevin Greer @Gino Barbaro @Jim Gramata for not replying! I was not ignoring you. 

The thing about Colorado is we never had a run up like this before. Doubling prices in four years is not sustainable. I am not one for trying to time the peaks or valleys, but I know I cannot cash flow well here. I am not one to buy simply hoping prices go up and lose money every month. 

The thing that worries me is our median prices are approaching what they can build new for. Inventory has been the cause of the price jump, but if they can build to meet demand, prices may stop increasing. There is no shortage of land where I am. I also don't see wages and employment matching the huge increases in home values. 

One of the biggest advantages of investing is buying below market. You can create your own equity. By selling some or refinancing some here and then buying new ones elsewhere I can make that equity work even harder and build more wealth by acquiring new properties cheap. I want to do it with cash flow too, which is why I want to invest elsewhere. The markets I am looking at have big upside, these aren't middle Ohio where prices are stagnant. 

The plan now is to sell three of my rentals here and refinance seven others . 

Buying below market value helps as well. 

 I focus on cash flow, but hope for appreciation, I never invest simply for appreciation and ignore cash flow. 

There is a lot to consider, holding rentals brings me about $9,000 a month in profit and tremendous tax advantages. I also cannot count on prices continuing to rise at 15 percent a year. That unsustainable. 

I posted about buying in another market a while back, well I am continuing on that path and have one of my rentals in Greeley under contract to sell. My plan is to sell three of my rentals here and refinance 7 others to take advantage of the incredible appreciation we have had. Most my rentals are single family homes, which makes them super easy to sell (at least right now)

Here are the numbers on what was my fifth rental.

• Bought to for about $88,000
• Put about $15,000 of work into it
• Had it rented to the same tenant for three years at $1,200 a month (that was low at the end) 
• The tenant was always late and a pain, but he always got caught back up and paid late fees
• After the tenant moved out we painted the exterior and that was it. The rest was in great shape. 
• Listed it for $199,900 and got in under contract in two days for close to list. 

I decided to sell this one, because it has a weird floor plan and was very hard to rent. Now I have to decide if I want to 1031 it, or just sell it and pay taxes. If I pay taxes the gain would be at 15 percent, which is not bad. If I 1031 it, I would be under pressure to replace it with 2 or 3 houses in Florida. I think I would be ahead paying the taxes and taking my time, because one great deal would make up for the taxes I would pay. My loan is about $66,000 and I would have a lot of cash to work with for more rentals. 

I used to avoid background checks, and even credit checks, mostly because I was lazy! I do things a lot different now. Here is an article I wrote about it. https://investfourmore.com/2016/04/08/what-is-the-...

Justin Cooper had some great advice. There are no websites that I know of. We put some of my flips on my real estate team website before they are listed and repaired, but I don't do much if any multi. Finding any affordable multi in Northern Colorado is really tough right now.