Colorado Springs Real Estate Investing Podcast Jenny Bayless, Chris Lopez

We’re wrapping up our 2023 Southern Colorado Investing Guide by exploring different investing strategies that work in today’s market.  Markets are reflections of many different factors, so the same strategy won’t work well all of the time.  But that doesn’t mean you need to be boxed into a strategy that doesn’t fit your lifestyle and long-term plans.  As you learn about the strategies we’re looking at today, think about how they match your goals to refine your own approach to investing. 







Check out the podcast to hear the details on a duplex in Pueblo used as a long-term rental, a rent by room single family home in Colorado Springs, and a house hack in Woodland Park that has a lot of possibilities.  Even though these strategies are very different from each other, the investors are each getting great returns. 









3 Learning Options! * Listen to the previous part of the miniseries "#133: 2023 Southern Colorado Investing Guide: What's the Best Investing Strategy for Today's Market?" Colorado Springs Real Estate Investing Podcast* Listen to the full episode (at the bottom) * Watch the episode on YouTube







In This Episode We Covered









* Investing strategies that are working in Southern Colorado:



* Traditional buy and hold rentals: While these are getting harder to make work, they continue to be a solid investment







* Short Term Rentals: Localities are tightening up their restrictions, but if you can operate one legally you have a lot of opportunity







* Medium Term Rentals: Since these are generally considered long-term rentals legally, investors aren’t subject to strict regulations but can still charge a premium







* Room by Room: While individual leases are more work to manage, investors can expect higher cash flow







* House Hacking: A great strategy for today’s market, but make sure you understand your lender’s occupancy requirements











* Properties we’ve helped our clients close:



* A Pueblo duplex with an 8.2% cap rate even with property management and a high interest rate







* A room by room rental in Colorado Springs that is expected to have an 8% cap rate when the owners move out after a year







* A house hack in Woodland Park that can be used as a long or short term rental and even has the ability to be converted into an event space!













Links from the Episode









* Part 1 of the Investing Guide







* Part 2 of the Investing Guide







* Deal Analysis of Pueblo Duplex







* Deal Analysis of Woodland Park House







* The Ultimate Hous...

What’s going on in Colorado real estate?  We've got the April 2023 market updates and trends, and our roundtable of experts is back to discuss what they mean. Envision Advisors agents Jenny Bayless, Preston Newberry, and Newt Wyler joined me to talk about all the trends we’re seeing along the front range, from Pueblo to Northern Colorado.  









Three Learning Options! * Listen to the podcast "#448: April 2023 Market Updates: Will Sales Prices Bottom Out?" Denver Real Estate Investing Podcast* Watch the YouTube video. * Read the blog post. Note, the blog is an executive summary. Get the in-depth breakdown from the podcast or video.







In all markets, median sales prices are down year over year, and we’re keeping our eyes on this stat to see how the current busy season impacts it over the next few months.  Now is a good time to be a seller—a well-priced property has a good shot at going over list price.  However, buyers also have room to ask for concessions since there are plenty of properties that have been sitting on the market for a while. 







In This Episode We Covered









* Great deals we can’t believe are on the market: opportunities for room by room rentals in Greeley, an updated duplex in Aurora with the potential for a 6% cap rate, and a fourplex in Pueblo listed for just $400K!







* I asked the panel whether or not I should sell one of my investment properties.  It’s a house with a backyard ADU that’s currently vacant.  You might be surprised by their answers!







* Property tax assessments just came out and many owners are seeing their home values jump.  If yours seems off, most counties have a June deadline for objections.







* Denver rental licenses are due by January 1st of next year.  If you own a rental property in Denver, make sure you get the process started now—you don’t want to get caught up in the rush and get stuck waiting for an approval.  Worried about navigating the process?  Check out our recent webinar on Your Ultimate Guide to Passing the Inspection.







* Sign up for our weekly deals email: every week we send out an email with properties for sale along the Front Range that would make great investments.









Denver Market Stats and Observations for April 2023







Active Listings









* Up 44% from April ‘22



* Homes +33%







* Condos +80%











* Up slightly from March ‘23







* At 4,600, it’s still a lot less than historically we would anticipate.



* The average number of listings at this time of year:  14,300.













Pending









* Down 18% from this time last year



* This is consistent with the past few months in Denver.







* It’s also consistent with the national trends.







* Until we see a meaningful uptick in buyers applying for a mortgage (which has been mired at ten-year lows), it’s not really possible for this to improve.











* Up 11% from last month



* That’s about in line with what we’d expect from ...

Welcome back to Part 2 of our 3-part 2023 Southern Colorado Investing Guide.  Today, we’re talking with local lender Jessica Khani of Aslan Home Lending about the types of financing options available for investors, plus different strategies they can use in a high-rate environment.









3 Learning Options! * Listen to the previous part of the miniseries "#131: What Are the Best Finance Methods Today? A Lender's Guide to Investing in Southern Colorado" Colorado Springs Real Estate Investing Podcast* Listen to the full episode (at the bottom) * Watch the episode on YouTube







Jessica isn’t just a lender, she’s also an investor herself. She started as a house hacker, has done the nomad approach, and now owns both long- and short-term rentals.  Currently, she has 5 rental properties and just sold her first house hack after renovating the home.  She’s the perfect person to help us navigate this complex and ever-changing topic.







Check out the podcast to learn about financing options for owner-occupant investors, pure investment property owners, and how to lower your interest rate. 







To find out which loan options are best for you, reach out to Jessica at jessicak@aslanhlc.com or call her directly at 314-265-0642.







In This Episode We Covered:









* What hard money loans are used for, and updates to the seasoning period requirements for when you’re ready to refinance out of this loan.







* Why adjustable-rate mortgages are becoming more popular as interest rates rise and what you need to know about them before opting for one.







* Why this environment is perfect for house hacking or nomading, and different ways you can implement these strategies while maintaining privacy.







* Different types of down payment assistance and grant programs for owner-occupant buyers.







* Rate buydown options that can save you money now and in the future.









Links from the Episode









* 2023 Southern Colorado Investing Guide Part 1







* Jessica’s Instagram

Want to know what’s working in the southern Colorado real estate market?  Today, we’re rolling out the 2023 Southern Colorado Real Estate Investing Guide!  This guide is designed to help you figure out how to invest in this market, what strategies are working now, and changes in the lending environment that will affect your deals.  We’ve divided the guide into three bite-size parts: real estate investing concepts refresher; different financing methods and recent changes; and strategies our clients are successfully executing, including recently closed purchases.









3 Learning Options! * Listen to the previous part of the miniseries "#130: What's Working Now? Your 2023 Guide to Southern Colorado Real Estate Investing" Colorado Springs Real Estate Investing Podcast* Listen to the full episode (at the bottom) * Watch the episode on YouTube







In part one, we’re focusing on real estate investing basics for Southern Colorado.  While the market may change every year, there are some concepts that continue to stay relevant.  We’re going back to these basics to remind you of how to approach analyzing your investment, less obvious costs associated with rentals, and different ways to evaluate your returns.  Understanding these concepts will give you the knowledge you need to find an investment property that fits your long-term goals. 







Check back next week when we cover financing methods, what lending rules have changed, and talk to a local lender about your options.  If you’re considering buying a property this year, you’ll want to hear what she has to say. 







In This Episode We Covered:









* How to calculate vacancy rate, and why 5% is a good rule of thumb for Colorado Springs investment properties.







* How Net Operating Income (NOI) helps you calculate your cash flow.







* Why cap rates are useful for creating one-to-one comparisons.







* What a BRRRR is, and why it’s difficult to execute in this environment.







* The four returns in real estate investing, and why cash flow isn’t everything!







* Our assumptions for southern Colorado investment property analyses, and why you’ll need to adjust them for your individual property.









Links from the Episode









* Rental Property Spreadsheet







* Previous Investing Guides for a href="https://denverinvestmentrealestate.

The spring selling season is here, and we’re back with your March 2023 market updates for the Front Range: Pueblo, Colorado Springs, Denver, and northern Colorado.  The markets in Colorado Springs and Denver are heating up, with prices rising month over month, though we’re still a long way from a balanced market.  Northern Colorado, our most geographically diverse market, is seeing increased sales everywhere, though prices are down a bit in Longmont and Greeley.  Overall, we’re excited about where things are going, and think next month’s stats will show increased activity, despite a somewhat slow start to the year. 









Three Learning Options! * Listen to the podcast "#445: March 2023 Market Updates: Where Are We Seeing the Best Deals for Investors?" Denver Real Estate Investing Podcast* Watch the YouTube video. * Read the blog post. Note, the blog is an executive summary. Get the in-depth breakdown from the podcast or video.







In This Episode We Covered









* We're seeing more buyer interest in every market, and we looked at some great deals in Pueblo, Parker, and Thornton.







* Rental activity is picking up everywhere, which allows landlords to push rents. 







* One listener suggested we use the Case Schiller Index.  That’s a great question that leads to another one—what other metrics do you think we should use to evaluate the market? Let us know!









Denver Market Stats and Observations for March 2023







Active Listings









* Up 103% from last year



* Homes +94%







* Condos +127%











* Total active = 4,500



* Historically, we average 13,600 listings now.







* While inventories are up, it’s still a tight market.







* March ’21 (remember how tight that was?) was the record low with 1,900 listings.







* Normally, we’d expect March to have 7-10% more listings than February.  This year, the listings grew 20%.  Nice to see some more sellers coming to market!











* In our last “normal” market pre-COVID, in Mar ’19 we had 6,300 active listings.









New Listings









* 4,500 in Mar ’23 vs 2,200 in March ’22 (+105%)



* The mortgage rates and the bad economic news started in March ’22.







* Sellers are getting used to this new environment and are more comfortable.











* We’ve had 11,400 new listings YTD.



* In our last “normal” market pre-COVID, in Mar ’19 we had 16,100 new listings YTD.







* I’m encouraged by the strong growth in new listings in March, but we’re still behind pace.







* Lower interest rates – perhaps a year away when we’re past the recession – will likely encourage more sellers to come to market.













Pending









* 4,300 in March ’23 vs 4,900 in March ’22 (-12%)



* Recall in 4Q22 our pending counts (when mortgage rates were at/near 7%) were off 30-40% from prior year.

We say it all the time when it comes to real estate investing: cash flow isn’t everything.  Sometimes, a negative cash flow investment property becomes a great long-term asset.  For Envision Advisors agent Leah Keeling, her Colorado Springs townhouse is projected to cash flow a negative $6500 the first year she rents it out. So, why are we excited about this deal?









3 Learning Options! * Listen to the previous part of the miniseries "#128: Don't Let Negative Cash Flow Fool You: How to Recognize a Solid Investment Colorado Springs Real Estate Investing Podcast* Listen to the full episode (at the bottom) * Watch the episode on YouTube







Leah has known for a while that she wanted to start investing in real estate, and she took her time deciding on the best strategy for her situation in life.  When she came across a new build townhouse in the city for only $305K, she knew she had to act on it. Her plan is to use the Nomad approach to investing. This means she'll live in the property for at least a year before converting it to a long term rental. 







Thanks to favorable FHA loan terms for primary residences, Leah was able to put down just 3.5%. This put her out of pocket costs at just $18K.  In fact, these low numbers are the reason she’s looking at a negative cash flow for this investment property. If this were a pure investment property, then she’d be putting down 25% and paying around $85K out of pocket.  Instead, she has an extra $67K she can save or use to invest in other properties.  Because Leah is a great saver, she's comfortable taking on the risk of negative cash flow. You’ll need to understand your spending habits to determine if this strategy works for you.







Real estate investing is all about perspective: what do you want out of the investment, what are your long-term plans, and how can this property help you achieve them?  In Leah’s case, she gets to live in a brand-new home until she’s ready to rent it out and move onto her next property.  Plus, she owns an appreciating asset in Colorado Springs and is starting off strong on her investment journey.







In This Episode We Covered:









* The Nomad investing strategy and why buying a future investment property can be a great move for families looking to get into real estate investing.  







* Why cash flow isn’t everything. Leah is confident in this investment because she understands the four ways to make money in real estate.  







* The importance of acknowledging where you are in life when deciding how to invest.  While house hacking, rent by room, or the BRRRR strategy can be lucrative, they require time and a willingness to share your space.  For someone like Leah, with a teenage daughter and dog, they weren’t the best strategies.









Links from the Episode