All Forum Posts by: Jeff Slusarz

Quote from @Seth Kristian:

Ive been hosting my primary residence in Denver for years without incident, and each year renew license etc without no issues outside of the standard bureaucratic headaches. Last Dec was no different, i send in the money for the license, fill out info and expect a reply shortly thereafter. Jan, Feb go by and no reply but airbnb had froze my calendar for STR availability (only open for > 29 days . Then Mar, Apr im making more attempts to figure this out with no reply from excise and license. First week of July i get an email, stating Denver denied my license. I appealed and set a hearing for August. Denver's state cause that its not my primary address because of a second address i had mail forwarded to back in Dec 2020, for one month. A mail carrier had been bitten by a dog on my street and 2 weeks had gone by with no one receiving mail. I wasnt sure what happened so i called the post office, they informed me of the details so i had my mail forwarded to a friends house in Lakewood. When i realized how long that process takes i had filled out another form within a month to cancel so mail would resume at my primary address. I provided evidence in my reply to no avail and the city wants to go forward with my hearing. I want to ask if anyone has had any similar experience with Denver or any other location insofar as STR licenses are concerned, and the city forcing you to defend your right to rent. Thanks, and any insight, advice would be most appreciated!

Sadly, the City and County refused to renew my STR license back in 2018; similar to your story. They went as far as to hire a PI to investigate where I lived (on the same lot, 100 feet away) and were threatening me with a felony. Honestly, once they decided to suspend my license, I don't think there was anything I could do to change their mind; obviously the hotel lobbyists had gotten to them and were demanding a crackdown on individuals competing with them.

I can't say I've kept up with things the last few years, but I sadly found I was fighting a losing battle and ended up caving and giving up my license. 

Quote from @Sean Walsh:

@Jeff Slusarz I had a similar experience. To be more precise, Denver's STR policy applies to the entire City and County, not just downtown.

City staff are meticulous at making sure the applicants for a license are in fact the primary residents of the property - including interviewing neighbors. In surrounding municipalities it’s a bit of a patchwork, so be sure to carefully research each city’s website for their regs.

Suburban Denver cities fall into a few categories: 1) those with no STR regs (yet); 2) those where they require the license holder to be the primary resident; 3) those that do not include a primary resident requirement for a license.

Of course do your due diligence, but I’m pretty sure Arvada, Wheat Ridge, Littleton and Centennial are in category 3.

Good luck!

Yes, I should have been more specific it's at the city/county level. And in my situation, my primary residence was on the same lot as my rental unit and they still were pursuing charges even though I asked my neighbors for permission, ran the property for over a year with no complaints and lived less than 100 ft away.

In short, it's just not worth the hassle in Denver City/County right now. 

Quote from @David Rutledge:

Quote from @Jeff Slusarz:

Denver is difficult as the City and County of Denver has limited STR to properties which are your primary residence. There's some complicated ways around it and things may have improved, but I can tell you that I was personally threatened with being charged with a felony in 2019 for renting my property even though I had gone through the proper permitting. You can certainly look in the suburbs or mountains, but the downtown area is going to be tough.

 Thanks Jeff, I read somewhere that Centennial and Adams County are allowing it. I am not sure where these suburbs are in relation to downtown and/or tourist attractions.

 Definitely more of a suburban location, probably 20-25 min by car to the downtown area from either. A lot of the food/bar scene is centralized in downtown Denver, so it's not ideal. 

That being said, a lot of my guests also were visiting to go to the mountains (or Red Rocks Amphitheater for a show), so it isn't all about downtown, but Adams/Centennial would add another 15 minutes on a drive to the mountains. 

Happy to help with any other questions. 

Denver is difficult as the City and County of Denver has limited STR to properties which are your primary residence. There's some complicated ways around it and things may have improved, but I can tell you that I was personally threatened with being charged with a felony in 2019 for renting my property even though I had gone through the proper permitting. You can certainly look in the suburbs or mountains, but the downtown area is going to be tough.

My family and I purchased properties in Scottsdale, AZ a few years ago which have appreciated significantly over the past 5 years to the point we have around $1MM in equity while having a cash flow of around $2K between the properties. As the managing partner, I'm trying to determine what's best as a next step.

I'm considering a few different routes including: 1) cash out refis on one or both properties 2) line of credit on one or both. I'm a former VP of a bank so I understand the advantages and disadvantages of both options, but it will really come down to matching financing with strategy.

This is where I'm struggling more: is it better to utilize the "lump sum" equity and buy a better home in a "better" market (our families live in Denver and we know Scottsdale fairly well, but our $800K is more likely to result in 1 or 2 down payments vs a cash purchase) or split the $800K into smaller chunks and investigate a higher volume strategy in a smaller market where our cash goes further (cash purchases and refinances or multi-families).

Would appreciate thoughts/experiences the community may have with "quantity vs quality"

I have been under contract for a property which I negotiated through a wholesaler.  I provided earnest money the same day and signed a contract to close on the 28th of January.  

The title company then rescheduled the closing to the 31st, however, as of the 31st, a city lien continues to exist on the property and clean title could not be provided.  The title company is now claiming they have 90 days to remedy this and I'm not entitled to terminate and receive my earnest money back.  

I've signed no documents indicating there is a 90 day period for them to cure the title issue and feel like I've upheld all my legal obligations and I'm entitled to the return of the earnest money.  Certainly not expecting legal advice, but curious regarding other opinions on my options in this scenario.  

@Brandon Wulff 

I actually own two properties in Scottsdale which we rent to MLB players for spring training and I'd echo Amber's comment above. Our HOA killed our original plan to provide STRs, so I'd strongly recommend finding a property where you won't have to fight this battle, because it only takes one person in the community to kill the plan (we use some creative ways to get around our rules, but DM me if you'd like to know those). We can't utilize it for events like the Waste Management Open, the Fiesta Bowl or the Super Bowl, so we likely leave another $10K on the table for those events.

We work with a woman who represents a few different players on different teams and they do like the appeal of Scottsdale, even when it means a longer commute to the training facility, so you may want to consider the "brand name" vs. Convenience.  Even Arcadia would be a good consideration.  

As for your plan, we make half our mortgage payments for the year in February and March, so price accordingly.  We have had some players come and rent October-January, so the market is solid then as well, but at roughly half the rent we get per month in the true high season.  

The plan is good, but my personal opinion is the better location is the more critical piece as it sounds like you already have the have the contacts to pull from.   

Originally posted by @Account Closed:

Originally posted by @Jeff Slusarz:

Looking into investing out of state and looking in the Phoenix area.  I don't want to base everything on a "rule" or a test, but finding most deals so far struggle to meet the 1% rule, let alone come close to the 2% rule.  I'm far more concerned with long term appreciation, but finding a deal that cash flows $200+ has proven difficult to date as I just dont see rents over $1200-1500 in most B/C+ neighborhoods.

Is this more of a reflection of a market to flip or just not having found the right deals yet?  Are other having success rehabbing and renting in the Valley of the Sun?

I'm doing fine in Phoenix. I bought a 4 bed 2 bath flip for $5,000 to the seller and taking over their $164,000 mortgage. I'm putting $60,000 into it and I have an offer in writing for $325,000 for when it's ready to close. I'll have a buyer's agent fee of 3% for a net somewhere in the area of $85,000

I bought a 3 bed 2 bath in Mesa for $31,000 cash to the seller and taking over their $121,000 loan. I have an offer on it for $255,000 "as is". I might let the new buyer do the rehab or I might fix it up and get the rest of the equity. I could end up selling it for a Turnkey for $80,000 and the investor taking over the mortgage and then put a Tenant Buyer in there for the investor who will get $25,000 Option fee from the new buyer along with a rent of $1,650 a month for a cash flow of about $650 a month.

I don't know if that meets the 1% rule but I'm happy with it and my California investors are happy with them.

@Mike M.  definitely sounds like you're thriving!  Are you utilizing a direct mail or another more aggressive tactic to find deals?

Looking into investing out of state and looking in the Phoenix area.  I don't want to base everything on a "rule" or a test, but finding most deals so far struggle to meet the 1% rule, let alone come close to the 2% rule.  I'm far more concerned with long term appreciation, but finding a deal that cash flows $200+ has proven difficult to date as I just dont see rents over $1200-1500 in most B/C+ neighborhoods.

Is this more of a reflection of a market to flip or just not having found the right deals yet?  Are other having success rehabbing and renting in the Valley of the Sun?

I'd love to put my name in the hat for this as well! 

I'm a traditional buy and hold investor trying to move my family business into a BRRRR/flip strategy and struggle with items such as quickly identifying ARV, utilizing my own cash vs. Private money, estimating rehab costs to quickly evaluate a deal and determining the "don't know, what I don't know" in value add investing.

I've owned homes downtown, Highlands and Sloans Lake, so I know Denver, but looking to apply my knowledge to out of state markets as well.