All Forum Posts by: Koren Lavi

@Thomas Biberacher My wife! She’s a fantastic mortgage broker out of Denver, has access to all kinds of products including HELOCs. I’ll DM you

Hey @Dan DeGroff

Buying as an investment property with a 0.75-1.0% higher interest rate and needing to put a minimum of 20% down (its actually 15% but the rates are so much worse at 15% that its not really an suitable option) when the home would actually be your primary residence is brutal.

Partership are a bad idea 80-90% of the time, but could work out in some scenarios. Not sure if this scenario would warrant it. 

I’m not a mortgage broker but my wife is. She deals with all kinds of unconventional scenarios like these. I’ll DM you her info.

Not too difficult in my experience. Might not fill 6 bedrooms immediately but when I rented by room there was always a good amount of interest (FB marketplace, craigslist, Zillow, roomies.com), especially if you are open to shorter than 12 month leases. 

Hey Steven welcome to BP! This is a fantastic place to gain some insight into the REI world, particularly for those starting out.

House hacking is a powerful strategy, and where many including myself have started out. It helped my wife and I save up money to continue investing.

I’ll give you one very important DO. Do you due diligence when selecting renters!

Margins getting thinner.

ADRs have actually decreased significantly in my market (Denver) since 2022. This kind of plays into the booking issue many have alluded to here. I’ve had to decrease prices to stay booked, which = lower ADRs. 

In addition to that property taxes have increased and property insurance has significantly increased. Same with cost of utilities, and cost of repairs/maintenance. Cleaning and supply fees have stayed about the same for me. 

Hey @Clemens Georg, first of all welcome to REI! This is a fantastic place to start.

To answer your specific question about your next purchase, a good places to start would be to reach out to a mortgage broker to see what your options are. Then based on that discussion, you would probably want to research some markets, run some numbers (proformas are great for this), and see what makes the most sense for you. 

The CO market can certainly be pricey, but there are definitely good options if you are flexible with location. Investing out of state can also be a solid option, but may pose some different challenges. With out of state investing you do not have the option to move into your next home as a primary residence to get a lower interest rate (it is a significant difference) and put a lower down payment (as low as 3.5-5% on a primary residence vs 10% minimum on a second home or 20% minimum on an investment property). A good mortgage broker can go over all of this with you in greater detail. 

For your second question, from my gathering it is very difficult to buy a primary residence as an LLC, but more doable to buy an investment property as an LLC.

Hope this helps a little!

Agreed with @Brian Bohrer. In my experience the best coverage with the lowest premiums hardly ever come from the big brand name insurance providers like Allstate, Statefarm, Geico, etc. It’s usually the smaller or local insurance providers that offer the best coverage and rates. A good broker will be able to set you up with those companies. 

I’ve got a really good insurance broker out of the Denver area I’ll DM you his deets!

@Meghan Begue

You had a really good question, is the higher cash flow worth the additional effort for STRs? 

I’m sure you will get different answers from different people based on their expenses/revenues and their tolerance to hospitality work. 

In my own personal experience, self-managing an STR can be quite a hassle at times, and not so bad at other times. 2 years ago my answer would have been that the juice is absolutely worth the squeeze for me. Today my position is a little more unclear. After recent significant increases in property taxes, homeowners insurance, utility costs, supply costs, maintenance costs, and construction costs the margins are thinner to a significant degree. There are still ways to make STRs work (good deal on a home, buying down to a lower interest rate, etc.) but make sure your profits are worth the hassle that you will encounter, because there WILL be some hassle with STRs. 

If you do move forward, make sure you have some other exit strategies. I would not buy a house that works as a STR but not as a LTR. Also I would make sure to buy in a neighborhood with good or better appreciation potential, so that you are not only benefitting from the cash flow.

Hope this helps!

I’m working with a lot of flippers and investors who need house projects done. I could always use a reliable and experienced GC. I’ll DM you @Matt Redick!

Hey @Alex Short, it’s definitely do-able to cash flow on a multi-family unit. It’s harder if you are putting minimum down, or if you are particular about where in the Denver Metro area you want a multi-family unit but it definitely can be done. 

Its not unusual that your insurance premium jumped, but I’m wondering if the jump was so drastic only because you switched to a landlord policy, or if its because your insurance policy is renewing and taking into account increased costs of labor and materials. Regardless you should definitely get a good insurance broker to shop different policies for you. 

I’ll PM you and give you a great insurance broker.