All Forum Posts by: James Carlson

Anyone else notice an increase in BP users responding in forums with what appear to be ChatGPT-generated answers?

The latest one I noticed was here. (No intention to single this dude out, but it's the most recent one I've seen.) I have a couple problems with this trend:

1. It's false advertising.
A lot of real estate professionals (including myself) give thoughtful responses at least in part to drum up business. (Along the way, we hopefully educate the community as well.) When you pop into a forum you know nothing about and post an AI-generated post without disclosing that, you're implying that you know the subject matter. Unsuspecting users may want to then use your services based on a false premise.

2. The info's flat wrong.
At least a lot of the time. The above linked post talks about Breckenridge, Colorado and Keystone as great options for a first-time short-term rental investor because they're "STR friendly." In fact, you can't get a new vacation rental license in either city, nor in the unincorporated Summit County that surrounds those towns.

Don't mean to be a boomer (or more accurately a Gen Xer) crapping all over the new tech, but the unvetted use of ChatGPT to answer nuanced, grey-area questions can lead newer investors into dangerous territory. 

Alright, I'm off my soapbox.

Using ChatGPT-generated responses adds no value to a discussion of Colorado STRs but more importantly ... much of this is flat-out incorrect information.

First off, it's laughable that "Breckenridge" would be proposed as an option for a first-time investor. I'm gonna go out on a limb and say the first-time investor isn't looking to spend $2M and be in the black $1,000/mo or more.

Secondly, and most importantly, you can NOT get an STR in Breckenridge (or Keystone, another option in your response). There is a cap on short-term rental permits in Breck and in Summit County ... and both caps are well over the limit.

I'm not against AI, but these types of un-vetted responses can harm new investors. 

 LOL. Yes, this.

The best way not to lose money on a home in Colorado or anywhere ... is to not sell it when you haven't gained enough equity yet.

We're keeping everything we can for now. I like the long-term appreciation more than the short-term cash flow. I treat our Denver and Colorado Springs investments like stocks. I'm buying and then not thinking about them for 20 years. 

@Ashley Gamble

@Steve K. hit it on the head. We do have a Sellers Property Disclosure that's required in all transactions. But they only have to disclose problems for which they have "actual knowledge" of.

So ... 

Do you know they had an inspector tell them about these water issues? Did they receive any kind of report about major moisture problems? The presence of the dehumidiers is something, but -- and I'm no lawyer here -- I'd bet that's not enough to hang your hat on in a lawsuit.

 Best advice I give my new Colorado buyers? Don't overthink it. 

A quarter percent rate difference here, a $10k difference in price there ... These things don't matter as much as getting in the game sooner rather than later. 

Biggest mistake I see investors/buyers in Denver or Colorado Springs make is that they get bogged down in finding the "best deal" and end up not buying at all. You're not going to hit a home run on the first one. You'll do great with a double.

Good luck!

@Brittany Guimond

We do medium-term rentals in Denver and Colorado Springs. We've stayed rented with little vacancy. However ...

We have been aggressive with price reductions to keep people in. Our SFH in the Springs is well below what we were getting just last year. We're lucky enough to have low rates and so we've got a buffer to drop prices.

That's all to say, yes, we are seeing a dip.

@Rene Hosman

I couldn't agree with you more about the need to spur homeownership.

I'm a bit of a split personality on short-term rentals. I know the Colorado Airbnb laws in and out and because of that work primarily with STR investors and second-home buyers. If you can legally do it, I tell people how to do so.

But I support the tightening of STR laws. While vacation rentals aren't a huge drop in the home supply bucket, they're not nothing, and any reduction in home supply for primary residences will eventually push prices up. So while I may enjoy knowing what investors can and can't do, I support cities telling more of my clients that they can't do STRs or at least limiting the impact of them.

And you're right...for house-hackers, this opens up a lot of other properties to them. I've had to think about zoning allowances when working with house-hacking buyers in Denver and Colorado Springs, but now everything is an option if you want to build your own ADU. I'm fine with that. Density is one big tool in the fight to bring prices down .

Now, this doesn't do anything to change primary residence requirements for short-term rentals. 

A lot of Colorado cities like Denver and Colorado Springs require you to owner-occupy the home in order to run an STR or Airbnb on it. (Yes, Colorado Springs also allows them in non-owner occupied homes but with limitations that in practice make it nearly impossible.)

I still think this change is good policy, but for anyone wanting a vacation rental in municipalities that have a primary residence rule, this doesn't change anything.

Thanks for posting, @Rene Hosman.

The statewide law is such a big  game-changer. Here's what I find most interesting.

Section 29-35-103(2)(b) of the ADU law says Colorado cities can NOT "require an ADU or any other dwelling on the same lot as an ADU, to be owner-occupied."

Cities can require that the primary unit be owner-occupied at the time of permit application. But after that ... hell, move out and you've got a duplex in what otherwise would have been single-family zoning.

As it used to be in Denver and Colorado Springs and most cities in the state, you could rent an ADU separately when you live there, but once you moved out, you legally could only rent the whole property to one party.

This changes everything for house-hackers and investors seeking multi-units. The way I read this, if you meet the setback requirements, you can have essentially a duplex on any lot in Colorado.