As a rental market, Denver is one of the best. Rates are consistent and occupancy is high—and most of all, Denver is a desirable location. In 2009, Denver is poised to become number one on the list of major cities coming out of the housing slump. Because of Denver’s excellent weather, educated population and excellent parks, the city remains highly desirable in any economy. A Denver landlord can earn a respectable income and enjoy long-term stability.
Taking the landlord approach, as opposed to a quick buy-and-sell, is a more long-term proposition though, and there are a few considerations. First of all, you do have leverage and can use equity in your existing properties to obtain financing for new ones, and this makes it easier to build a larger rental business. But unlike shorter-term deals, the interest rate is extremely important. Paying high interest for a short-term hard money loan pending a sale may be worthwhile, but paying high interest for years on a rental property is cutting into your income. As a landlord, your income is the difference between what you pay out on mortgages, maintenance, taxes and insurance; and what you take in from rents. Your biggest expense is your mortgage, and so it is in your best interest to make the mortgage payments as low as possible.
We know all the ins and outs of the landlording business—if you need help getting started, or just have a question, give us a call at 720-284-4411 or email us at Sean@denverrealestatemoguls.com. And if you already have properties ready to go, now’s the time to take a more strategic role and leave the property management to us at Denver Real Estate Moguls Property Management.