Rental Property: As Close to a Sure Thing as You Can Get

Unless nuclear war breaks out and civilization ends, the one sure thing in Summit County real estate is that there will always be more renters than rental units.  
Despite years of work to build more rental housing, most workers filling the estimated 22,000 jobs in Summit County drive in from Leadville or Kremmling.
Efforts continue to make the county affordable for workers.  New developments must include affordable rentals. The Summit Housing Authority sells deed-restricted properties.  Up to 400 afordable properties will be built on the Dam Road… eventually.  Vail Resorts continues to build affordable rentals in Breckenridge and Keystone while putting more beds in current housing units.
But it won’t be vacancy
The number of jobs continues to increase while the number of places to build continues to decline.  So rental property is gold. 
The problem is to find rentable property at a price that makes sense given the rent rates.  
Short-term skier week rentals are not the answer.  And mortgages will prevent maximum cash flow.  But as a long-term strategy, paying down the mortgage coupled with the increased value of the property over time works with patience and discipline.
It’s hard to find another investment that will return as much as rental property will for a cash buyer.
A two bedroom unit renting for $1500 net per month bought for $250,000 could achieve a 7 to 9 percent return.  This assumes no mortgage and that $1500 is your net income each month after HOA dues and taxes, etc.
A home or duplex at $425,000 or so might net $2500 per month or so and bring  a similar return.
Treasury bonds will bring only 1 to 3 percent, but are almost entirely risk free.
Rental property is certainly not risk free.  Summit County rental property, however, cuts the risk of vacancy to nearly zero.
Rentable properties are available at prices that can make sense.   But entire buildings are not.  You’ll need to piece your empire together one property at a time.
Buying one unit in something like a duplex or four-plex, might bring the opportunity to buy the building over time as the individual owners decide to sell.
Being a landlord isn’t for everyone.  You can either live with your tenants overhauling the Harley in the living room or you can’t.  Check out your tenants.
And get some financial advice before committing to this large, long-term investment.  This article is purely anecdotal.  Your mileage may vary.  You may suck at being a landlord.
But this strategy works because I’ve done it over the past 30 years.  I’ll eventually sell my 8 unit building… maybe to you!… if I can figure  out where to put the money.

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