All Forum Posts by: Peter S.

@Josh Pociask what areas of DBQ are you seeing as good investment opportunities?

@Matt M. good point. I've spoken briefly with a lender but I probably need to to actually sit down with him and work through a few scenarios to see if this plan is even possible. Thanks.

@Chris Lopez appreciate you sending over those links, I'll take a look this week. The 2k/mo counts taxes and insurance but doesn't currently include repairs/vacancy since I live there now. I like your advice about zillow and CL for rental comps, I'll do some research there too.

@Chris Lopez as for the numbers, that part is tough. The current mortgage on my primary is just under 2K, based on my area and house size I think I could get 2700-2800 realistically so I'd be cash flow positive about $7-800/month. 

The real trick would be figuring out the numbers on a new property. Let's assume it lists for 500K, I could put 5% down (25K) but that would mean I still have PMI and my payment is probably close to 2850/month at a 4% interest rate. In this scenario I make about 800 from the rent on my current existing property so my out of pocket cost is about 2200 a month or only about $200 more than I pay now, except now I have 2 properties instead of one.

Alternatively I could look at doing either a HELOC or cash-out refi of my existing home to be able to make a larger down-payment. If I could put down 20% (100K) then I don't have to worry about PMI and now my payment is around $2100 on the new place and whatever my additional payment is for the HELOC or refi. So my out of pocket would be close to $1300 plus the additional loan.

Either way it seems like a solid move, but I can't help feel like I'm missing something here. Obviously I run the risk of having to pay both mortgages in the same month anytime I have a vacancy, but if I'm able to AirBnB the new place, I'd think that would mostly offset that.

Thoughts?

@Steven D. sorry i was just confused. I'm actually looking at a new build, no desire to do a flip. 

Thanks for all the feedback. I am now definitely more considering buying something here in Denver vs out of state. My money will go a lot further here if I owner occupy, and I could always move back to my current house down the road and rent the newly purchased place. That way I'd turn a portfolio of 1 primary residence into a primary plus a 2nd SFR or 2/3 plex right?

@Steven D. Yeah I'm thinking of doing something similar, my biggest issue is finding something I actually WANT to live in and is still a reasonable commute to my job (although if it's only a year I could probably go anywhere). I'm not sure I understand what you mean by live-in-flip. Could you explain?

Hello BP,

I've been saving up capital to purchase an OOS turnkey for the past 1.5 years. Was thinking about putting in about 30-35k and getting something in a B/B+ area in the Midwest. Recently I've seen some older homes in the City Park West area of town purchased, torn down, and replaced with a multi-unit building. 

Now I'm wondering if it would be a better financial strategy to buy one of the properties, owner occupy and rent out my existing home. My thought process is that rather than use 20% down on a 130-160 property in the Midwest I could instead use 5% down and get something worth 550K or more. 

From a numbers standpoint I could probably make about $700-800 profit renting my current home which would subsidize the new mortgage payment on the new property. The property I'm looking at would also have AirBnB potential as well. To me this seems like a no brainer but I'm also sure that there's something I'm not considering. What does everyone else think. 

Thanks @Matt M.

What are some of the criteria you use to decide on a bank? I am looking to do a HELOC in the next few months and it would be great to have some ideas of what to look for (and look out for).

Thanks @Colin Smith and @Norberto Villanueva for weighing in.  I'd prefer something in a B class or above which means I probably need to get a bit more money together to be able to purchase something in the 200K range. 

What is the typical purchase price range for cash flowing properties in Colorado Springs? I have some capital saved up and was going to look into turnkey but if there is something worth looking into that is closer to home, perhaps that might be a better option.