All Forum Posts by: Michael Vialpando

Hey Gabrielle! That's not a bad idea if you can get a landlord on board (and at this point, there are a lot of STR people who are feeling the pinch and are pretty panicked about what the future might hold for them). I'd agree that you can find someone who would be happy to offload some of their risk that they have right now.

One tricky part would be the STR permit with the city of Colorado Springs. You'd be able to do it "owner-occupied" while you lived there but it then has to meet a different criteria (500 foot buffer / density requirement) to be ran as a non-owner occupied STR.

I think the best place to identify this very specific group of owners / landlords would be to reach out to them directly on Airbnb or through the COSSTRA Facebook Group that is comprised of many STR investors.

My wife and I have definitely felt some pain with mass cancellations and demand plummeting in the last couple weeks across all of our short term rentals. But we acted quickly, pivoted, and overlaid a huge multi week and monthly discount to the month of April for our STRs. Almost immediately, all of them were rented out again; albeit, at massively discounted rates, but to a different demographic: people who HAVE to move or find a place for the medium term and not just people traveling for leisure. We now have 4 of our places full of people who are moving to the Springs and need a place for 3-6 weeks while they find a long term place or have a house built or are waiting to close on another house. Are the rates what we were hoping for a month ago? No way, but they more than cover the mortgage and we limited our downside risk while still keeping the upside of having them available for short term stays come this summer (peak season). 

Anyways! Feel free to reach out to me if you have any other questions. There's definitely an opportunity to capitalize on over-leveraged STR investors who are panicking.

Cheers!

Michael

Hey everyone! Thanks a bunch in advance for any help or support.

My wife and I have successfully acquired two house hacks in the last two years. We have typically rented the the main house (or a portion of it and got roommates) and then short term rented (Airbnb'd) the guesthouse. We were fortunate to have enough W2 income to purchase the second house hack without needing any rental income, leases, or money showing on our schedule E.

Now... We are in a different spot and it's gotten more tricky. We are currently living in the basement unit and renting out both the main level and the converted, detached garage studio. We are making fantastic gross revenue and doing very well with managing our systems and expenses to provide great stays for our guests. So we are ready for moving on to our third house hack and our goal is to be moved into another nearby property in Colorado Springs (either 80903, 80904, or 80909) and replicating what we've done.

Here's where we are running into some speed bumps. My wife in school to become a Nurse Practitioner and has cut her RN job back to one 12-hour shift per week. Combine that reduction in W2 income with the debt from our two properties and we are finding it hard to qualify for more than $300k. We have found one lender in the Denver area that will take our one year of Airbnb income from the first guesthouse - which is great. However, since we had two roommates in the first property in the main house with us, and since we correctly reported their income on our taxes, we are being told that we are unable to use a lease on the main house since there has already been income reported on it (only $9800 for 2018 since the roommates were only there half of the 2018 year).

Apparently we are able to use leases for our new property since nothing has been reported on our taxes yet since we bought the second property earlier this year in 2019. Which is great to be able to use 75% of market rent for our two units at the second property. What is hurting us most, is the deductions we claimed on our first property's guesthouse and the fact that we had roommates and reported income on the main house - which was MUCH less than if we had rented the house as a WHOLE for the ENTIRE calendar year.

We are excited to figure out how to navigate our way to our third SFR with a guesthouse or ADU that we can buy with conventional 5% down, owner-occupied financing and continuing to house hack our way to a strong financial future!

Any ideas or suggestions from other house hackers or creative investors and lenders would be amazing.

Thanks everyone!

#househackforlife! #almostreadytohousehacklikebrandoninmaui

My wife and I are prepping to do our third house hack in Colorado Springs. Our finances have become interesting with rentals, Airbnb, & W2s. We are looking for another SFR that cash flows while we live there, cash flows when we move out, has an ADU, guesthouse, or layout that is conducive to splitting it up on the inside with separate entrances, and/or a detached 2 car garage that we can convert to a residence / ADU.

I have heard from my last mortgage broker and a couple investors that First Bank / 1st Bank can sometimes do things that brokers cannot do. I thought that was interesting so I thought I'd come on here and see what other options we have and hopefully get pre-approved for our next house hack!


Thanks Everyone!

Here's some details about what we've done so far:

Property 1: Corona St

Property 2: Platte Ave

Property 3: TBD

Hey David, the other guys definitely have some good points about being cautious and making a good financial decision vs just doing it to say you did it. But there is always a way to create a deal vs finding a deal. My wife and I are house hacking our second property and doing very well here in the springs. Just do your homework and run the numbers. Renting by the room or doing Airbnb is a great way to get better returns too; but only if you're willing to sacrifice some comfortability in the short term. 

Good luck! 

My wife and I just landed. When I signed up, the happy hour was already sold out. Does anyone want to pick a spot for those that didn't get happy hour tickets? We'd love to meetup for drinks / dinner! Feel free to shoot me a message since I can't post my cell on here?

We are currently specialize in Short Term Rentals (Airbnb) in Colorado Springs, CO (80903, 80904, 80909) but are looking to learn other methods and develop a plan to continue investing from this conference.

Investment Info:

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

Purchase price: $430,000

Cash invested: $30,000

Hello! I'd like to share an update on our last adventure and thank you all for the help along the way! Last year, we moved away from our 5 acre, 5 bedroom "dream home" with a creek in Monument, Colorado. We traded it in for a 1898 Victorian in downtown COS. It is a 3/2 with a 1/1 cottage that we Airbnb'd. The swing in cash flow was $3,195/mo in our first year. My wife has been able to reduce work and focus on going to NP school while I've been able to save up cash quickly for the next deal!

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

House-hacking from listening to Brandon Turner and Scott Trench's Set for Life book were very influential. The low entry cost and risk also made the decision much easier.

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

We found this deal on the MLS. We paid top-price for the house since it was move in ready. We outbid with an escalation clause and then negotiated new roofs, furnaces, and hot water heaters - everything else was already new.

How did you finance this deal?

We used conventional owner-occupied financing - 5% down, 30 year fixed. We liked the low rate and the long term rate for better cash flow.

How did you add value to the deal?

We didn't have to do much besides the furnishing and decor. We did some landscaping to add curb appeal, but that was about it.

What was the outcome?

We used to have a negative cash flow at our "dream house" of NEGATIVE $2,637 a month. We purchased the old house for $393k, but with taxes, insurance, utilities, repairs, and other monthly costs, it brought us up to a large monthly liability.
With the new house, after all expenses (and outsourced cleaning) and even saving for capex and repairs, we were cash flow POSITIVE $558 per month.
That swing in cash flow was $3,195 per month. It has been amazing.

Lessons learned? Challenges?

We learned a lot on the fly, but also avoided a lot of headaches and expenses thanks to all the information here on BP. We also have to give lots of credit to Daniel's book, Optimize Your Airbnb, so we quickly climbed the ranks to be in the top 1% of listings in the area for 1 bedroom listings.

Did you work with any real estate professionals (agents, lenders, etc.) that you'd recommend to others?

We worked with traditional residential real estate agents from The Behr and Behr Team with The Platinum Group. Leah is absolutely amazing and on top of her game! Nothing slipped through the cracks and she helped address and negotiate concessions.

Hey @Colin Smith! Thanks for providing the platform for Kim and I to speak on Short Term Rentals, Airbnb, and the current and changing STR ordinances for Colorado Springs. We love talking about this newer trend of real estate investing and mixing it up with the tried-and-true, timeless investment methods.

Let us know if you ever need anything else. Also, thanks for helping us with the Platte house! It was a roller-coaster for sure, but it brings us closer to our near term goals and that wouldn't have been possible without you. Thanks!

And incase any of the STR hosts or want-to-be-hosts are interested in the upcoming ordinances, check out the Colorado Springs Short Term Rental Association (COSSTRA) on Facebook. That is how the majority of hosts and investors in town interact, share, and come together to be involved in the community and the Airbnb Ordinance process.

Hi Shauna! Good luck with your goals! I am sure you will get there soon and this step seems like it could be a step in the right direction. My wife and I bought a house and cottage in Colorado Springs. We live in the house and rent the 1bed/1bath cottage on Airbnb. Similar to Robin, we have experienced very high occupancy rates. In 2019 so far, we have been booked 62 out of 66 nights. In 2018, we started our listing halfway through May. We were booked 206 nights out of the 231 we had available. But we also pay about twenty bucks a month for an app that varies our pricing every day to make sure we stay as booked as possible and get as much as possible during high demand times. We learned it all from a book on Amazon called Optimize Your Airbnb, I wouldn't even try the short term rental game without reading that book first.

If you are seriously interested in Airbnb, I would pay $20 on AirDNA dot com and pay for the Airbnb data for YOUR zip code. It will show you the top 10 grossing airbnbs in your zip code. This is huge for figuring out what you can generate from it vs guessing occupancy and nightly rates. Our nightly rate varies from $52 a night during certain parts of the winter to as high as $225 a night during peak season and graduations and what not. AirDNA can show you all that since they mine the data from Airbnb and then show it in pretty graphs. You can even filter the top 10 properties to only show the top 10 listings that are only 1 bedroom or only hold a certain amount of people. I highly recommend it.

Let us know what you find out! But also know Airbnb is much more like a business and not nearly as passive as a long term tenant. 

Good luck!

Congrats on the potential deal! I don't have an answer, but would love to hear what others say.

@Thadeous Larkin I sent you a PM

Also, This link may still work even if you don't have a facebook account. 

https://www.facebook.com/COSSTRA/