All Forum Posts by: Olivia Caldwell-Nepveux

Learn how building a guest house (also known as an ADU) in your backyard and renting it on Airbnb can help you generate extra income or offset your mortgage costs.

Join us for a hands-on and informative session where we’ll show you how easy it can be to build a profitable short-term rental in your own backyard. Matt Krick, an experienced ADU architect and short-term rental investor in the Denver area, will walk you through the steps to design, build, and profit from your very own guest house, along with Olivia Caldwell-Nepveux, a successful real estate investor and Denver realtor, who will share her expertise in navigating the local real estate market and leveraging ADUs for financial success.

What’s an ADU?
An Accessory Dwelling Unit (ADU) is a small, self-contained living space built on the same property as your main home. It can be a detached guest house, a garage conversion, or a basement apartment—perfect for turning into a rental!

What You’ll Learn:

• Maximizing Rental Income: How to turn your backyard ADU into a profitable short-term rental that generates steady income.
• Designing for Success: Simple, effective tips for creating a guest-friendly space that attracts bookings.
• Financing Your Project: Easy, creative ways to fund your backyard guest house without a huge investment.
• Understanding Local Regulations: How to navigate zoning laws and permitting requirements to ensure your project runs smoothly.
• Real-Life Success Stories: Hear from homeowners who have turned their backyards into income-generating properties.

Hey Tariq,

I personally have 3 properties here, 2 of which are short term rentals, so happy to speak to investing in STRs here. I am an also an agent that niches specifically to STR investment properties, so happy to offer detailed insight.

I love investing in short term rentals here - I have one that does over $85k gross a year, one that does over $75k gross a year. It has been life changing for me! I purchased both STR houses in the low-600s range. There are absolutely areas where you can beat a 10% cap rate - I see it all the time - you just need to know where to look and what types of properties perform best.

Some areas I would check out include Bailey, Arvada, Westminster, unincorporated Adams County, and many more I could point you to beyond that. The regulatory environment is the first thing you should consider when buying a STR here - it is both the worst and best part of being a CO STR investor. It is the worst because you need to understand the patchwork of regulations across the state, which can vary down to a neighborhood by neighborhood basis. This is also the best thing, because many out of state investors find it confusing and stay away, which keeps our returns much higher and wards off Wall Street investors from buying up swaths of houses, which we've seen in other markets.As an STR specialist, keeping up with zoning and regulation statewide is a huge part of my job.

I also host monthly short term rental events for local investors, monthly webinars, and I also often get furnished, turnkey off-market STR properties. A lot of STR investors prefer to sell off-market so they don't have to shut off business during tours, and I'm lucky to get access to a large majority of those deals in CO. I definitely recommend connecting with an STR community in the CO area, because it's great to meet other people doing the same thing and bounce ideas off of one another. Feel free to shoot me an email if interested in coming to one of my events - I have several upcoming, happy to shoot you an invite.

Last point I will make - while cap rate is helpful, I prefer using cash on cash return. I find it more helpful to track on my total cash into the deal (inclusive of furniture, amenities, etc), so cash on cash and monthly net cash flow are the two metrics I find are most informative when I'm looking at a purchase. 

Liv

Hey David!

I am a STR focused investor/agent. My properties are primarily in Arvada, CO, but I have a pulse on the market of regulatory environments throughout the state since I am almost entirely niched to STR investors in my business. There have been increasing issues with unincorporated JeffCo... I even have a friend who received an unfounded complaint from a neighbor (the neighbor was just against STRs, no events/parties that occurred), and now their property is temporarily banned/under review, regardless of them abiding by all rules. I'm not currently encouraging investors to do unincorporated JeffCo for that reason - they've become more strict/unfriendly over time. Still can be done, but you do run some risk of neighbor complaints, etc., more so than in other areas of CO that are more investor-friendly. In terms of the current rules, as you mentioned - updates to legislation are currently being discussed. For non-primary residences, they have to follow all of the following rules to receive a permit:

- the property must be a minimum of one (1) acre in size (designed as a precaution to disturbances)
- The building standards of the underlying zone district must be met
- Adequate parking is provided
- Defensible Space requirements are met
- Valid water and sanitation must be demonstrated
- No more than five (5) bedrooms are in the dwelling

As time goes on, they continue to become more strict on the rules listed above here, and are actively regulating it. If I were you (and you meet the items listed above), I would definitely still move forward with licensing since you already have the property. In the future if you plan to continue to invest in STRs, would encourage other areas - shoot me a DM and happy to walk you through where I'm seeing the most friendly regulations and best cash flow. 

Liv

Hey Bradley! 

I definitely have - I've done it 3 times myself, and have a multimillion dollar portfolio that gets a ton of cash flow. The only way that I've found for it to make sense financially given such low down payments, has been to turn them into short term rentals. 

You can get the best of both worlds on cash flow and appreciation by doing short term rentals once you move out, or by doing a house hack, where you rent out an ADU or separated basement rental on short term rental platforms while living in the other piece of your house. I've done both successfully! The key to understand about STRs in CO is the regulatory environment - it is simultaneously the best part of investing here, and the worst. It's the best because it's confusing, which keeps Wall Street investors out, and keep our profits high with lowered competition. It's the worst because it's pretty difficult to navigate if you don't have someone experienced to guide the way. I'm entirely STR focused as an agent as well, and work with pretty much exclusively STR investors, so I have my finger to the pulse of the regulatory environment here in a county, city, and even neighborhood basis. If you're curious, I also host monthly networking events, meetups at current house hack and STR properties, etc. where you can soak in a ton of information and meet with experienced investors who have done the same strategies. Feel free to reach out - would be happy to pass along a free invite, or pass along any other resources you may need!

Cheers! 

Hey Austin! 

In terms of networking, my group hosts monthly investor networking events, cocktail hours, presentations, etc. We get a great turnout (typically 40-50 people per event), and it's a wealth of knowledge for investors in the Denver area, and well frequented by a ton of seasoned investors. Shoot me an email, DM or text and I can make sure you get a free invite. Would love to have you - it's a great way to connect with other likeminded people! 

For property management, I highly recommend Luxa Rentals, which you can find at https://www.luxacorporaterentals.com/; there are a variety of tiers and it's a small-scale, well-priced local manager that is happy to customize the service depending on your needs. 

Cheers! 

Hey there! I'm with Good Neighbor Realty, the brokerage mentioned above. I focus on working primarily with STR and MTR sales, but my husband (Jonathan) specializes on the property management side of the business. He has specific management tiers, but is also happy to customize a plan depending on your needs. Shooting you a message with his info. You can also see his website here: https://www.luxacorporaterentals.com/

Thanks! 

Hi Liam! 

I'm a CO based STR investor and STR-focused agent. For short term rentals, I use:

AirDNA: I love AirDNA, but don't love the address search. Instead of this, I find it more helpful to look at percentile performance across the market for a specific asset type, and also to check comps. This also helps me to forecast seasonality on my properties. Be wary of just using the address search bar, as I've found it can give inaccurate answers at times! 

Rabbu: Rabbu is a free tool to analyze STRs, but provides a significantly more conservative look than realized data, and tends to be less accurate than AirDNA. Also note that Rabbu does not take cleaning costs into consideration, so that will lower it. I have seen properties show up as far as ~$50k lower in annual revenue than in realized income, so know that the numbers aren't always perfect! I also don't love the search bar on Rabbu, and prefer using specific comps. Happy to walk you through how to do this - just reach out! 

I see that you're in CO - STR investing in CO can be extremely profitable, which is why my personal investment portfolio is so heavily weighted in that direction. Regulations are both the best and worst part of investing in CO - best because they are confusing, which gets rid of large Wall Street investors and keeps competition lower and profits higher. Worst because you really need to have an experienced expert or specialist to walk you through the regulatory environment, as it can vary on a county, city, or even neighborhood basis! Clients who work with me on STRs are given all analysis tools for free (including expensive AirDNA), and I will personally analyze all deals, and guide you through a confusing regulatory environment, as well as help you to find lesser-known honeypot spots around the state. I also get a TON of off-market, fully furnished STR listings through my network here, which can be lifechanging deals. If you're interested in networking, we have monthly STR networking events in the Denver area that can help you to become more familiar with STR investing here, and connect you with top STR investors in Denver.

Cheers! 

Liv

Hello!

I have a pipeline of off-market, value-add deals available in the Denver/Arvada/Westminster area, and am seeking interested buyers. If this is of interest, please leave us some information on your buy box on the Google form below so that we can connect you with properties that fit your criteria. Please no wholesalers - looking for serious buyers only.

https://docs.google.com/forms/d/e/1FAIpQLSf0z-yAW9qh3WefYBM2...

Have a great day! 

Thanks,

Olivia Caldwell-Nepveux