Deal Analysis – First Rental Property in Colorado Springs

This deal analysis breaks down how a young couple made their first real estate purchase to start building their rental portfolio for retirement planning.

This property closed Q4 – 2020.

Investor Profile

• Young couple
• First-ever property purchased

Deal Quadrant: MLS

Investment Property Details

• Type: Townhouse
• 2 bedroom, 2.5 bathroom
• Location: Airport and US-24
• List Price: $185,000
• Purchase Price: $190,000
• Why we liked it:
  • Proximity to major arteries and military bases
  • End unit
  • Move in Ready
  • New Appliances
  • New Paint

Property Contract Details

• Finding the property: Buyers had submitted very strong offers on similar properties previously but had lost out to cash buyers.  This one was under contract with a different buyer, but it came back available so we acted quickly.  We were not the highest offer, but the seller liked the buyers’ lending.
• Under contract:  Above ask and secret sauce
• Inspection Concerns:
  • None
• Inspection negotiation outcome:
  • None

Property Financing Details

• Lender: Conventional
• Loan Type: 15% down conventional
• Appraisal: at value, no issues.
• Seller Concessions: 0
• PMI: Monthly
• Interest Rate Buy Down?: Yes

Spreadsheet Rental Analysis

Property Operating Expenses

First Year Returns

Conclusion

We are estimating $1,497 a year in cash flow after accounting for the mortgage, insurance, taxes, vacancy, HOA, and putting money aside for repairs and reserves.  The landlords are managing themselves, and they got a well-qualified tenant in the property very quickly (barely any vacancy).  Not bad for only putting 15% down!

For more Colorado Springs Deal Analyses including house hacks and multi family properties, check out our Colorado Springs Deal Analyses page.

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