Why Should I Purchase a Rental Property in Colorado Springs, CO
If you are considering purchasing rental property in Colorado Springs, CO, what are some of the determining factors you should be looking at? Let’s look at some important information about the city and how a property manager can help determine if this market is right for your investment strategy.
Before looking for investment property, know what your investment strategy and goals are. Are you looking for cashflow, appreciation, or both?
Begin researching the market by looking at city trends such as:
- Is the city growing?
- What types of industries contribute to the economy?
- What are the real estate trends in the area?
The data is going to tell you a story that you can use to determine if the market offers the investment opportunities you are looking for. Make smart purchasing decisions based on numbers rather than emotions. Let’s take a look at Colorado Springs.
About Colorado Springs, CO
Colorado Springs is located 61 miles south of Denver. The city’s elevation is over one mile above sea level, and it sits at the base of Pikes Peak. It is a popular tourist destination for the scenery and rock formations along the hiking trails in its many parks.
- Population: 450,000
- Cost of living is slightly above US average
- Great schools
- Family Friendly
- Multiple universities and colleges
- Multiple military bases
Colorado Springs has won countless awards and rankings such as:
- #1 "Big Cities to Live In" – Money Magazine
- #1 "Most Desirable Place to Live"– U.S. News & World Report
- #2 “Cities for Veterans”- Livability
- #6 "America's Most Wired Cities" – Forbes
These are just a few in a long list of rankings the city has been given. Colorado Springs is an outdoor lover's dream, and you enjoy outside activities like hiking year round. The quality of life and highly rated schools make it a great place to raise a family.
Economy and Industry in Colorado Springs
- 4.1% current job growth – above the US average
- 48.4% future job growth
- 3.3% unemployment
- $58,158 average income
Colorado Springs has a strong, growing economic base.
There are a significant number of military bases and defense corporations in the area. These include Fort Carson, Peterson Air Force Base, Schriever Air Force Base, NORAD and the U.S. Air Force Academy. Therefore, as expected the economy in the area is mostly based on the military installations. The local economy is also fueled by a heathy tourism industry as well as local aerospace and electronics industries.
The area has seen some of the best economic recovery from the COVID-19 pandemic issues credited to their highly educated workforce that was able to work from home. Colorado Springs' diversification of jobs also contributed to their quick recovery.
Real Estate in Colorado Springs
- $287,900 average home value
- 9.7% increase in appreciation
- 46.6% appreciation over the last 10 years
- Black Forest
Home values have increased along with the city’s growth. This is a good, stable area to invest in. If you are looking for appreciation, Colorado Springs is a city to search for investment opportunities. To determine if there is cash flow potential, you will need to run the numbers on specific properties. Compare the home purchase price to what you can rent the property for.
How to Accurately Set Rent for my Colorado Springs, CO Rental Property
As an investor, you want to maximize your return while also reducing vacancy time. This requires setting your rent rate to what the market demands. It is also critical that you put the right tenant in the property.
There are several things that can affect what you can charge for rent
- Are you renting your property during peak leasing season?
- How is the economy in the city?
- What are the days on market now?
- What is the year over year growth in the city?
Rent prices tend to grow with a growing city, so you want to look at the city trends over the last few years.
Rental statistics for Colorado Springs
- $1,620 average rental price (all units)
- $1,195 for 2-bedroom house
- $1,727 for a 3-bedroom house
- Days on market: 40
- Occupancy: 95%
- 36% renter occupied
- 63% owner occupied
More owner-occupied properties is good for protecting your property value. There seems to be a significant rent difference from 2 to 3 bedrooms. When purchasing a property you may want to look into that further as a 3 bedroom might give you a better return. Before purchasing a rental property, find out what people are looking for. Your vacancy time will be effected if you have a property type that is less popular.
Why Should I Hire a Property Management Company in Colorado Springs, CO
Does it make sense to hire a property management company in Colorado Springs?
This depends on your unique needs and circumstances. Would you like someone to handle the day to day operations of your rental property? Maybe you are an out-of-town owner that needs someone local to take care of maintenance issues. Mynd offers 3 pricing options for management so you can purchase the level of service that works for your unique situation.
- How valuable is your time?
- Do you mind handling that 2am emergency maintenance call?
- Do you know what you can and cannot ask on an application?
- Do you know if you are complying with all the laws and regulations that apply to your rental unit?
What does a property management company do for you?
They will take care of the day-to-day operations related to your property such as:
- Getting the property rent ready
- Marketing the property
- Accepting and screening applications
- Lease signing and enforcement
- Handling maintenance calls
- Lease renewals
Their job is to ensure the tenant is safe and the property complies with all laws and regulations
Laws and regulations
Not knowing the law isn’t an excuse if you break one. If you aren’t interested in keeping up with ever-changing laws, hiring a property manager may make sense for you. Mynd has legal counsel on staff to ensure our systems and procedures comply with all the laws. There are local, state, and federal rules, regulations, statutes, and laws that apply to your rental property. If you are self-managing your property, you are responsible for keeping up with the regulations and laws that apply to your rental.
Examples of laws that apply to Colorado Springs rentals:
- Colorado Adverse Possession Laws
- Colorado Civil Statute of Limitations Laws
- Colorado Homestead Laws
Typical maintenance issues in the area include:
- Checking A/C furnace due to extreme temperatures
- Seal leaks and cracks around the property
- Lawn care
- Pest prevention and removal
Put your property in the hands of a professional
Just like hiring a CPA for complicated tax returns, you may find hiring property manager is the best option for peace of mind that you are abiding by all the laws. With offices in over 19 markets, Mynd can be your go to for property management across your entire portfolio. Contact Mynd today about our Colorado Springs property management services.
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