All Forum Posts by: John Krauklis

Great plan.  I got heavily involved in str in Denver that made me some good money.  I bought a house in Avon, co in between Vail and Beaver Creek.  In 2018 it was $770,000 for a 5 bedroom, 3 bath house that needed a renovation.   The family and I spent the summer up there and I renovated it while enjoying the incredible outdoors all around. We put a hot tub and a fire pit in.  Now it pulls in $150,000 a year gross with about $50,000 in mortgage payments and overhead a year.  We use it a lot too.  Christmas to New Years is easily $30,000 of income.   I have gone with the big house niche and it’s worked out great.  It seems the hardest thing to find out about mountain properties is real rent numbers so there are mine.  
now I am building new construction houses in Denver and about to move my family into a nice one in Bonnie Brae 
good luck!

Homewrights.com

They are awesome!   Help you build company.  I have worked with them on two specs in Denver now.  The first one in Platt Park netted me $400,000.  The one I am finishing up in Bonnie Brae will net $1,500,000!  
Great people, great subs, great structure.  Really guides you to success and also helps qualify for the construction loan with the bank.  
check them out.  
John. 

Update on the progression of this remodel.  House is going great.  The dry wallers are just about finished with their work and should be out in a few days.  Then it is some trim work and the painters can start.  Meanwhile my buddies are working on other small projects like finishing the exposed brick, fireplace hearth repairs, hanging tile backer, back porch repair, etc.  I was able to put in all new plumbing, electrical and heating/ ac which are all coming online now.  I was able to use a nice Lennox high efficiency heater from another house that I own that got demoed.  It is up and running with all new heat runs and a big return air to the foyer.  The house previously had boiler heat but I wanted ac too so forced air is the way to go.  Today I was installing windows in the back room, finishing the return air line, getting the plumbing supply lines finished and jumping on the dumpster trash to get more in it.  The house is a constant battle to keep it clean and organized.  Also I have to be thinking a few steps ahead always with orders and scheduling subs.  The painter stopped by today to put his bid together and I said to be ready in a week and a half.  I ordered some double pane glass for the front door and back transom. 
I’m hopeful we can be done in 2 months and then start the refinance.  The good thing with rental is not everything has to be finished perfectly.  
It is really fun to bring this old house back to life and make a really nice rental out of it.  With it only a mile from the city and right next to a large hospital, the rental should do well.  
The budget is doing fine.  Drywall and flooring came in a little more but I took a lot out of the landscaping budget.  Not really any other surprises as far as fixes.  I can handle most structural and brick issues so that saves me.  
Glad the heat is on for these cold days!   Hands have had some busted knuckles and one bad splinter yesterday.  
John

@James Carlson the $6000 was for 30+ days rental.  We had 3 guys working on irrigation systems for DPS stay about 3 months.  It’s cheaper than hotel rooms, and you can cook.  Then we had a few families relocating to Denver and needed a place to be for a month.  
I closed on the property yesterday and today started getting the junk out and demolition of walls.  Very fun to get into an old house again and make it something much nicer.  
It has great curb appeal and is in a great location so I am confident it will rent well.  

The market in Denver is hot for just about anything.  We have a furnished rental in Denver that has been getting $6000+ Per month all summer and fall.  It is a 3 bedroom/3 bathroom.  If you showcase it right on Airbnb, you can get a lot.  
I will soon find out if that holds true for all parts of downtown and all seasons.  

Check out 145 W 1st. It just sold for $1.070.000! It has a newly built garage apartment and a nicely renovated two story house. I actually put together the numbers to build this ADU and I was at $220,000 about 3 years ago and passed on it because it just wasn't worth it to me. Adus take a special builder that is a sucker for punishment by the city and the tight confines of the urban environment. You are also building in a backyard with neighbors all around and limited access. I would say a 600 sf garage apartment over a 2 car garage is easily $250,000 + nowadays. If you can find someone who has the time.
 What part of Denver are you in?

I built my ADU about 6 years ago and did a lot of the work myself. I get $2000 a month on Airbnb for furnished 30+ day rentals. It's a 1 bedroom 600 sf. Paid for itself long ago!

John

Seasoned real estate investor here in Denver.  I concentrate on buy and holds and new builds.  You can’t beat the appreciation of Denver!

Hi all.  I’m a real estate investor in Denver with many years of house flipping and Airbnb experience behind me. I generally stay solo and try to use bank money and slowly build my real estate portfolio.   I currently own four houses in Colorado.   I just finished a new build that sold and have purchased another lot and am in the design and city submittal process for a new build.  I have a downtown Airbnb rental, a mountain rental and my family’s property.  
 I am about to purchase my first property with hard money from a wholesaler and remodel it to hold as a 30day+ Furnished rental.  It’s a historic 1887 Victorian two story house in downtown Denver that has really never been remodeled. It has been vacant for years and looks very original and dirty on the inside.  Just how I like them, not livable and overwhelming for most.  I’m a sucker for historic properties so I get a thrill out of working on such a vintage house.  It was sent to me by a wholesaler and the charming curb appeal got me.  Next door to my Airbnb rental is a property owned by a hard money lender who is a very nice guy.  He agreed to do a loan with using a second mortgage on my rental as my part of the money in.  
I plan to have the new house remodeled, rented and refinanced within 6 months.  Then the original loans get paid back and I have a fully remodeled rental property with no cash outlay and appreciating nicely in Denver.  The monthly income should do pretty well and get me a few thousand over the monthly mortgage payment.  Is the seasoning time a concern for some mortgage lenders?   Are there ones out there that don’t care about that?
Purchase price is $488,000, renovation and holding costs will be $100,000. ARV with using some great recent comps will be $725,000.
My wife loves to decorate a house and is quite good at it.  We have most all of the furniture to go in it from other rentals.  Then I will list it on Airbnb for 30+ days and hopefully get $5000 a month.  Are there other big furnished monthly rental sites to consider?

Then do it again!   Looking forward to gaining the knowledge and experience of working with the hard money loan and the wholesaler.  I was surprised that the hard money loan is not that much higher for what a bank mortgage would cost.  If I can get it done in 5-6 months, I will only be paying at most $10,000 more to go the hard money route.  For me, if I can get the deal done and quick, that’s worth it.  And I’ll make that back in appreciation in a few months of owning it.  Better than sitting on the couch!   Rise and grind!

John

Great post and thanks for the insight of the current steps in the process.  I love ADUs.  I built one at my house in Baker about 6 years ago and it was very easy then and I did it cheap by doing a lot of the finish work myself.  Back then the historic district did not have much of a say and I am already zoned for it.  I have a property in Capital Hill that has an original 1896 built carriage house on it so the idea is not new.  I have also finished out quite a few not permitted adus since the owners wanted nothing to do with dealing with the city. I think the process and hoops you jump through are completely ridiculous.   The city should make it much easier to create this great urban form of housing.  The nimbys can go pound sand, or move to Parker.  Welcome to the modern Denver city.  
I wish the city would clear a path to allow for a small ADU that is cheaper to build and very easily rented to be legal in Denver. I hope the full city designation is coming soon.
As a real estate investor, I alway look at how to add value, and making the garage rentable in some way is one good way.  Nice to hear the process is possible in areas not zoned for it.  
thanks!

John

All the west neighborhoods are great- Westword, Barnum etc.  You can get away with a lot there cause everyone is renting their garage that has an ac unit in it to their cousin.  
I would seriously consider buying an RV 22’ or less and parking it in the backyard for extra income!   
West side of Baker (my hood), Santa Fe arts district has some things in your price range and is great location.  
I have done well with Airbnb, ADUs and renting everything I own to get ahead in real estate and now it is my full time job.  Lots of str opportunities here.  
Denver is hot for real estate and will continue to be.