All Forum Posts by: Omar Shahid

I have seen a TON of advertisements about Lease Options and I really like the concept since it is low to no money down.  However, I think it sounds a lot easier than it actually is.  Is anyone doing this type of business in the Denver Metro area....I would like to target Aurora...specifically.  My 2 largest concerns are if there are enough motivated sellers to sell their home on terms with a lease option....and if there are enough buyers to want to do this in Denver.  Would love any type of guidance on this...As I am thinking about purchasing some training on doing Lease option deals.

Hi guys.... Great stuff. I am also an investor in the Denver market. I only invest part time and only own 2 rentals....so pretty novice but do have some experience. I bought my first rental in 2009 and the other in 2013...Both as owner occupied so I have good rates and really good cash flow since they appreciated a ton... I am not sure about investing in Denver right now.... market is so expensive. However, not sure if Denver will ever come down in price.... I like the Condossince they are cheaper, but HOA fees are pricey. What do you guys think about finding Lease options in Denver??? I am thinking about trying that.

Thank you so much Chris.  I would greatly appreciate that.  The deals on the market to me are just not worth it.  The cash on cash return in Denver is hard to get above 10%.  Haven't really explored the refi or pulling out equity.  That may be an option down the road. 

The mgmt for this property is easy since it is close and the tenant takes care of minor repairs without bugging me. 

I currently own a rental in the 80016 zipcode in Beacon Point close to Southlands Mall area, which is 4 bedroom 3.5 bathrooms, 2600 sq feet . I am debating on selling this or holding it. I purchased the home for $335K in Feb 2013 and moved out in June 2016. The house is worth about $450K and we rent it our for $2,650 a month. My monthly loan pmt with insurance and taxes is about $1700, so the monthly cash flow is great. It is a newer house and the tenants are very easy going so I have had very minimal repairs. HOA is only $140 a quarter!!!. I love this rental since it is in the same neighborhood where I live which makes it very easy to manage or show the house with vacancies. My concern is that this is an expensive rental and I know that it may be difficult to rent out when the current people move out. If I sell it before June 2019, I can avoid the capital gains tax. I am considering selling this and buying another cheaper rental, since I have a lot of equity in the home, I owe about $246K (value of home is $450K to $470K). However, the Denver market is so pricy that I have no idea how I will find a deal. I am a part time landlord that owns only 2 rentals that I manage myself and I have a full time job, so I don't have a lot of time to find deals. Should I hold or sell before 2019??? Should I try renting it for as long as I can and maybe do a 1031 exchange after the 3 year period is up??? Also, any Denver/Aurora investors investing out of state or currently investing in Colorado???

I am not sure about Colorado. I live in Colorado and the prices and market are red hot. Especially in Denver. It really depends on the ROI or CoC in my opinion. I always try to find deals with atleast 12% CoC. I am looking at Chicago and Florida.

Thanks for the advice Matt. There will be pretty minimal work as the home is newer and in good condition. Still a little confused on whether I should sell. lol. I think I will probable sell next spring and see how the market is. I certainly want to buy another rental, however, I might look out of state or the city of Denver. Maybe Pueblo. I just love the interest rate on my current rental and the fact that it is so close to my house. But for me, it is all about CoC. will run the numbers and see what I can get.

Thanks,

guys, I will be honest I understand this is not a good rental. However, Denver market is red hot!!! It is almost impossible to get a unit that rents for 1% the purchase price. I do have another rental, which was also my personal residence, that I purcashed for $216k and rent for $2,250 a month. However, I bought that house in 2009, lol. There is no way I can get anything close to that now. In Denver it is next to impossible to get a rental for under $250K that would rent at or over $2K a month. Maybe it might be best to invest out of state????? Any local Denver investors, please provide me your feedback??? Are people activitely purchasing properties that rent out of 1% monthly of the purchase price? I am actually thinking of selling this house and using the proceeds to use as a down payment for a dueplex or multi unit property. All about the COC for me and cashflow :). Let me know what you guys think???

So let me ask you this? Should I sell it or cash out refinance????

 Thanks for the input Cody.  I have actually rented out 2 properties that I had lived in.  My other property is doing very well and this one is not bad but a little expensive and not as good of a rental.  However, I agree that I love the interest rates I have on the property.  I am a little nervous about the cash out refinance because it would reduce my cash flow and I am not sure I can find a good deal with the cash out money in Denver.  I am leaning towards just holding the property as is right now.  I have been spoiled a little bit with the good cash flow I am getting on my two rentals, and I am not sure it is worth the risk.  However, I will need to run the numbers and see if it is worth doing the cash out refinance. 

 Thanks Bill.  Great suggestions.  I agree with you and I am finding it is difficult to find good tenants in this price bracket.  I have never really thought about the lease to buy option, as I probably would prefer to hold on to the house.  The only reason I would sell is if I can use the proceeds of the sale for a better investment.  The problem is it is tough to find good deals out there.  I might do some analysis on maybe putting down 50%-60% down and see what the numbers look like with better rental units.  What are your thoughts of a cash out refinance since I have good equity on this home? I owe $240K and home is worth $460K?

Thanks,