All Forum Posts by: Matthew Osborne

Have you thought about Colorado Springs? I just closed on a duplex for a client there and was amazed at the deal we got him. It is still a very competitive market but has opportunities. COS has a strong rental market with a lot of government and military needing housing and a new amazon facility going in near the airport. This is the shortlist. 

I would agree with @Matt M. I personally would add about another $25k on that estimate due to unforeseen issues (remediation, foundation problems, material cost/availability, etc ). I see a lot of structural problems due to our expansive soils and poor drainage. FYI there are contractors in the Denver area that will give you a free estimate on if there needs to be any foundation work done. How much if any work will you be doing yourself? 

@Brian Fiorillo, I have been in Colorado since late 2006. I have seen Denver and surrounding areas change dramatically. I myself am not a Michigander, but my wife is. If you want to touch base when you and your fiancé get out here (or before), I would be happy to help you with some inside knowledge. 

Investment Info:

Single-family residence buy & hold investment in Colorado Springs.

Purchase price: $324,000

Pandemic Special! The sellers were distressed due to ongoing issues and they wanted out. We were fortunate enough to use a lot of equity that we had in our primary residence to help us make this purchase in cash since bank financing was most likely off the table with the issues. Knowing what was wrong going into the deal actually made it much easier to know what costs were going to be. This has been a great rental in the best school district and a great neighborhood.

What made you interested in investing in this type of deal?

It had distressed sellers, had major issues that prevented buyers with loans from bidding.

How did you find this deal and how did you negotiate it?

MLS, cash, and quick close waive the inspection objection due to known issues.

How did you finance this deal?

Through tapped equity and some private capital

How did you add value to the deal?

The property was 98% complete and done fairly well. There were previous issues that were ignored that needed addressed.

What was the outcome?

High rents due to demand, location, and school district. It currently rents for $3000/mo

Lessons learned? Challenges?

Take on other people's problems they do not want to solve.

Investment Info:

Single-family residence buy & hold investment in Colorado Springs.

Purchase price: $324,000

Pandemic Special! This house was recently flipped and some major things were ignored. The sellers were distressed due to ongoing issues and they wanted out. We were fortunate enough to use a lot of equity that we had in our primary residence to help us make this purchase in cash since bank financing was most likely off the table with the issues. Knowing what was wrong going into the deal actually made it much easier to know what costs were going to be. This has been a great rental in the best school district and a great neighborhood.

What made you interested in investing in this type of deal?

It had distressed sellers, had major issues that prevented buyers with loans from bidding.

How did you find this deal and how did you negotiate it?

MLS, cash, and quick close waive the inspection objection due to known issues.

How did you finance this deal?

Through tapped equity and some private capital

How did you add value to the deal?

The property was 98% complete and done fairly well. There were previous issues that were ignored that needed addressed.

What was the outcome?

High rents due to demand, location, and school district. It currently rents for $3000/mo

Lessons learned? Challenges?

Take on other people's problems they do not want to solve.

Investment Info:

Other buy & hold investment in Muskegon.

Purchase price: $250,000
Cash invested: $66,000

It is a church! That happens to sit on 3 city lots, zoned for multifamily, up to 6 units per lot. The existing structure is in excellent shape and is in current development into 4 residential units that will be used for Short-Term rentals.

This is also within an Opportunity Zone.

What made you interested in investing in this type of deal?

Great area with a lot of potential with lakes and beaches.

How did you find this deal and how did you negotiate it?

MLS

How did you finance this deal?

Private capital

How did you add value to the deal?

Rezoned lots, redeveloped existing structure (in process)

What was the outcome?

To be determined...

Lessons learned? Challenges?

To be determined...

Investment Info:

Single-family residence buy & hold investment in Muskegon.

Purchase price: $33,000
Cash invested: $7,500

This property had been vacant for at least 5 years before we purchased it. It was 100% the worst house in the neighborhood and when it was all said and done it should have probably been taken down. In the end, it turned out great and has a lot of charm. The full renovation of this project cost around $70k. It is a 2 bed one bath in a great location. It currently rents on Air BnB and VRBO and averages $2500/mo gross income.

What made you interested in investing in this type of deal?

It was cheap and in a great neighborhood.

How did you find this deal and how did you negotiate it?

Off-market. Cash is king.

How did you finance this deal?

Private Capital

How did you add value to the deal?

LOTS of sweat equity

What was the outcome?

A short-Term vacation rental that averages $2500/mo gross income.

Lessons learned? Challenges?

Make friends with the neighbors, you might find your next house cleaner.

Investment Info:

Small multi-family (2-4 units) buy & hold investment in Muskegon.

Purchase price: $62,000
Cash invested: $5,200
Sale price: $95,000

2 units that had a possibility to be 3 units if could get approval from the city. It was unfortunately a high hassle property due to poor property managers. It cash flowed well at just under $1000. Held this for just over a year. Using the capital from the sale to develop a 4 unit short-term rental in a much better neighborhood.

What made you interested in investing in this type of deal?

This was part of a syndication. I personally was not excited about the numbers that this property had but it was a great learning experience on what I do not want to own.

How did you find this deal and how did you negotiate it?

This was an off-market deal.

How did you finance this deal?

This was with a private capital loan

How did you add value to the deal?

The property was vacant for just over a year. It needed lipstick on the 1st unit Bath and kitchen. The 2 unit needed a shower and bath remodel.

What was the outcome?

Not much profit but was not a loser. The learning experience was worth it.

Lessons learned? Challenges?

Depends on your mentality of being a landlord. This particular property and location was a high hassle with tenants and poor property managers. This was a long-distance investment. While this could have been kept in the portfolio with sourcing better management, there were other properties that were owned that the capital would be better used on for us.

Investment Info:

Single-family residence buy & hold investment in Denver.

Purchase price: $440,000
Cash invested: $88,000

Primary Residence used as a house hack from the day of purchase. Remodeled the basement with my own labor. Rented this space for $750/mo. Has a separate entrance and has helped to lead to other investments. The property has appreciated to almost double the purchase price in 4 years. With a cash-out refinance, it allowed reinvesting in another property and development on another.

What made you interested in investing in this type of deal?

The location was up and coming, next to a very high-income area, great accessibility, and home layout allowed for a separate entrance basement.

How did you find this deal and how did you negotiate it?

MLS. Paid over asking with an escalation clause to win multiple offer situation.

How did you finance this deal?

20% down Conventional

How did you add value to the deal?

Added a bathroom, garage, remodeled basement, remodeled kitchen. All my labor

What was the outcome?

House hack that gained large amounts of equity within 4 years that allowed a cash-out refinance that went to other investments.

Lessons learned? Challenges?

Materials and labor are not getting cheaper.

I have nothing but good things to say about Bellco. Painless for a HELOC. I would recommend getting an appraisal if they do not give you the line amount you want it may be how their system values. Plus they have 2.25% on their qualified checking accounts. I have yet to find something better to hold reserves.