I've been an active Real Estate investor in Denver for the past nine years and I have never seen a better time to own rental property in Denver. Two factors make investing in Denver Real Estate very attractive right now. First, rental rates are going through the roof with no sign of stopping and second, interest rates remain insanely low.
Another reassuring factor is that rental rates increased despite there being more inventory for renters to choose from. And while developers are building apartments as fast as they can, experts predict it won't be near enough to meet the demand over the next ten years or so. And with rates hovering in the mid 4% range right now, you can afford to own a rental property and cash flow it like we will never see again. You will pay a higher interest rate for an investment property and will need to put 20% down. But if you can swing that, I think you would be suprised by the cash flow potentials possible.It is always a good time to own rental property when rents are increasing with no sign of stopping. Apartment rents in Metro Denver increased 6.3% in the third quarter of 2013 compared to 2012 hitting a near all time high of $1,048. Adjusting for inflation, rents right now are 2.2% below the all time high ever seen in Denver in 2002 right before the dot-com bust. Luckily for us, there isn't a dot-com bubble, or any other type of bubble, driving growth in Denver, it is simply a great place to live with lots of jobs and we are seeing groves of people moving here and needing a place to live.
As an example, my buyer closed today on a house in Englewood. It is 3 bed, 1 bath with a two car garage and very nice yard. It is in very average condition and all my buyer is going to do is some touch up and paint. He expects to get $1,600 a month or more and with his total mortgage at $995 a month, he is going to see a monthly cash flow of over $600 a month! On top of that, he bought in an area of Englewood that is exploding and will very likely see double digit appreciation the next 5 to 10 years making it a can't miss investment.
There are lots of great investment opportunities like this in the Denver metro area right now. You don't have to spend a ton of money to get a good rental and as you can see, you can get a very good return on your investment for under $200,000. And with rental rates increasing 6% or more a year, just imagine how much this will cash flow 5 years from now? If you are interested in investing in Denver Real Estate, please let me know and we can certainly talk about your options. The home pictured above is in Lakewood and at $225,000 has great potential as a rental. For more info, click here.
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