All Forum Posts by: Manoj N.

All. Thanks for your insights. Looks like Colorado Springs is a good place for me to start crunching numbers. Unlike Denver region, the cash flow is higher here. I understand that these houses might not appreciate like Denver-Boulder region.  However, my current goal is to improve my cash flow since the cash-flow from my Louisville properties (which have appreciated a lot) are not that great.

I have been following BP for the past two years and have hugely benefited from this collective knowledge. I currently own two rental SFRs in Louisville, CO area - both doing well. I am thinking about upping the game and buying my first multi-family home later this year, probably in fall. The main reason is that when I run numbers, multi-family homes come far better than single family homes.  Couple of questions. 1) Denver-Boulder region is way to expensive for me. Is there any place <2 hours from Denver where I can find sub 500K 4-plexes ? 2) How much down payment is required by lenders for this? Usual 25-30% ?  I can put together about 100K for down payment 3) I have currently 3 mortgages, including that of my primary home.   Getting more will be difficult ?

@Nicholas Kangos I got them sign an addendum to allow for the stay of his so till the end of the lease term. 

Thanks @Anthony R. and @Nicholas Kangos.  Your feedback make sense.  I will let him stay till the end of the term. 

My tenants wanted their 35 year old son who was originally not in the lease to stay with them for 3 months. I agreed and made a lease addendum to include him for 3 months after doing a background check.  That period expired a month ago and I saw him at the house last week while driving by. When asked, the father told me that he had to stay because of some financial problems. They now wants their son to stay longer. I find that this is a violation of the lease terms. Also the were hiding this fact from me. But what should I do? Suck it up and add him to the lease for the reminder of term? Then they may think that they can violate other terms in the future? Demand a new lease with a small increase? Their lease term ends in 3 months. Should I refuse to extend the lease just because of this situation? Otherwise they were good tenants. Plus always  paid rent in time. 

Just an update to my rental situation. Surprisingly the volume of calls increased dramatically last week with many people wanting to apply. I did a trick that appeared to have worked. I set up the showings back-to-back on Thursday evening giving each party only 15 minutes of time. So there were overlaps and the parties felt the pressure of competition. Got two high-quality applicants and secured the lease next day. Even managed to increase the rent by $55! Thanks everyone for your inputs. 

@Jon Holdman Good tips on asking for feedback. It never occured to me. My home is priced lowest even if I include Lafayette or Superior. And my price comparison is with similar age townhomes. Because this property has 3 bedrooms ( + 3 bath, 2 office rooms), opens to a backyard and still priced much lower than a SFR, I guess I am not competing with apartments. @Dan Close That is what I like to believe :-)

@Bill S. I advertise on Zillow affiliates and craigslist. Also on realtor.com. Plus a rental sign. I think smell is not an issue since I had the duct system cleaned and it smells nice. Carpets are a bit old, but serviceable. Fresh paint. Another thing that might be affecting is that my row of townhomes have backyard facing a busy road - although fenced off. My pre-screening is basically asking them whether they meet my requirements. So I do get a lot of qualified persons.  Good advice to get a third party opinion.  I do see that my call volume has increased significantly in the past week. Hope spring is finally here.  @Jon Holdman I am comparing my price with other townhomes in Louisville/Boulder area. Do you have any experience asking for feedback ? In my experience most don't even bother to get back after showing. 

I bought a decent townhome in Louisville, CO in January first week. It is a 3 bedroom townhome in a great neighbourhood. I put it in market after a few minor repairs. After the first week of low interest, I reduced the price to below market rate - such that mine is the lowest priced 3 bed home available in the whole Louisville-Boulder area. I require a minimum income of 2.5 time rent, a credit score of 620 or greater, and clear background checks. I had lots of interest after I reduced the price 3 weeks ago - about 50 enquiries, 17 showing and 1 application which was rejected due to job issues. I am really surprised why it takes such a long time to rent my house.  I notice that my competitions are also just sitting in the market. Is it just because of the cold season ? Any clues Denver gurus ?  

Good question. I must admit that I have not looked at a lot of alternative scenarios. Currently my down-payment equivalent is parked in an S&P 500 fund which gives me reasonable return, especially in the past year. I am considering RE investment to push the return above the 8-9% average S&P. Since I like to buy properties close to where I live and since I have full-time day job and a demanding family, I am not considering places far outside Boulder. I have analyzed more than 50 properties in the past year and most of them barely comes to break even in cash flow sense. However, even with a 4% appreciation the IRR from a typical Boulder property is > 13% with about 10-20 years of holding period. This number is modest considering the Case-Shiller-Denver estimate of 10% annual increase over the past 25 years, primarily propelled by new comers settling in the area. This is kind of the background of my original question, sorry that I should have been clear about this at the beginning. I really appreciate all BP gurus posting their views - I learned a lot.