If you're an investor in Denver or Colorado Springs or any other Front Range city, you're seeing dollar signs. But how you go about buying and setting up an Airbnb investment property differs depending on where you live. (Especially when the laws are changing city to city. And as of the last update on this page in October 2019, many cities are changing their laws.)
(Download our reports to learn what you can and cannot do with Airbnb in numerous Front Range cities.)
Here are strategies depending on where you live.
Buying an Airbnb investment property in Denver can be difficult. Denver's Airbnb law restricts short-term rentals to only your primary residence. (And as of October 2019, the city had filed felony charges against four Airbnb hosts who were running short-term rentals in properties that weren't their primary residence. So be sure to consult with someone -- hint, hint: US.)
But the Denver Airbnb law does allow owner-occupiers to rent out a separate space on their property as much as they want. So we work with a lot of clients to find properties with a basement apartment or a carriage house out back that gives you a full Airbnb rental while retaining the privacy of your own space.
With an Airbnb investment property like this, you can live mortgage free or close to it. So you get a new home and a rental that will cover much if not all of your mortgage.
There is not an easy way to search for homes on the MLS with ready-to-go separate spaces with a kitchen and bathroom. We have developed a number of searches that capture these units. Reach out today if you're interested.
Alternately, Colorado Springs provides a great investment opportunity. Unlike Denver, Colorado Springs does not have the primary residence rule and in fact, the city has passed an ordinance specifically allowing for Airbnb and VRBO in any kind of investment property.
You can buy one, two, four, 10 homes down there, furnish them up, and start renting them out full-time on Airbnb. (Check out the Colorado Springs Airbnb laws report for more info.)
Update: As of October 2019, the city of Colorado Springs was looking at a 500-foot density limit law. That means that they are considering allowing only one non-owner occupied short-term rental within 500 feet of any other non-owner occupied Airbnb rental.)
Fort Collins' Airbnb law is somewhere between Denver's and Colorado Springs'. They have pockets in which you can rent out only your primary residence and cannot own a full-time Airbnb investment property. But there are other sections of town (some that are near downtown and Colorado State University campus.)
Colorado's mountain towns like Winter Park, Vail, Aspen, Steamboat Springs, Breckenridge, Keystone, etc. tend to be open to Airbnb investment properties. This makes sense as short-term rentals are their bread and butter. With many of the towns, however, they restrict the areas in which you can do it and prohibit it in other areas that they want to retain for affordable housing.