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- Your Daily Dose Of Knowledge! January 12, 2025 - #257
Your Daily Dose Of Knowledge! January 12, 2025 - #257
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Welcome Back,
Hi and welcome back to The Wealth Wagon’s real estate market analysis. I hope you all have had an amazing weekend so far as it begins to come to an end. Today we will be diving right back into another market. Enjoy!
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Real Estate Investing
Market Snapshot:
Fort Collins, Colorado
The Fort Collins real estate market remains a hotspot, with a median home price of $525,000, up 6.3% year-over-year. The city’s strong appeal to families and professionals, combined with proximity to Colorado State University, fuels demand for single-family homes and rental properties. Active listings are down 4% from last year, intensifying competition among buyers. The region benefits from its robust tech and healthcare industries, which have kept unemployment rates below the national average at 3.1%. However, rising mortgage rates have tempered first-time homebuyer activity, creating opportunities for investors targeting rental properties.
Median Home Price: $525,000
YoY Price Growth: 6.3%
Active Listings: 1,200 (down 4% from last year)
Deal Of The Day:
8-plex in Westwood Fort Collins
Price: $2,400,000
Units: 8 (2-Bed, 2-Bath each)
Monthly Rental Income: $16,000
Cap Rate: 7%
This 8-plex offers investors a reliable cash flow in the Westwood area. Each unit rents for approximately $2,000/month, generating $192,000/year in rental income. The property also has room for appreciation, with Fort Collins’ growth trajectory projected to continue over the next decade. This is an excellent option for investors seeking a long-term hold with immediate returns.
Deal Rating: 8/10
This deal shows great opportunity in not only the area of cash flow but also in property appreciation. This property is located in a great neighborhood offering great ability to attract renters. The main downside is the ability to add value to this property as it is currently one of the most expensive properties in the area with little to no interior renovations available.
Real Estate Tip:
Investment Strategy:
Tenant-in-Common (TIC) Agreements
A Tenant-in-Common agreement allows multiple investors to co-own a property, each holding an undivided interest. It’s an excellent option for those with limited funds who want to invest in larger properties.
How it Works: Each investor owns a percentage based on their contribution and shares in the rental income.
Example: Three investors pool together $200,000 each to purchase a $600,000 multifamily property, sharing profits proportionally. This strategy diversifies risk and maximizes purchasing power.
Current Interest Rates:
Fort Collins, Colorado
30-Year Fixed Residential: 7.0%
15-Year Fixed Residential: 6.4%
Commercial Rates: Starting at 6.4%
Interest rates for 30-year fixed mortgages in Fort Collins are currently 7.0%, slightly above the national average. While higher rates may deter first-time buyers, they have created stronger demand for rental properties, offering investors steady cash flow opportunities.
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How Fort Collins is Tackling Housing Affordability
The housing market in Fort Collins has been grappling with affordability issues, as rising home prices outpace wage growth. To address this, the city has introduced initiatives like incentives for affordable housing developments and zoning changes to allow Accessory Dwelling Units (ADUs). ADUs—such as backyard cottages or converted garages—are gaining traction as a solution to both affordability and rental demand.
For example, an investor building an ADU for $80,000 could generate $1,200/month in rental income, offering an attractive ROI. This trend aligns with Fort Collins’ goal to balance its rapid growth with sustainable housing options. Investors who capitalize on ADUs early could benefit significantly from this growing market segment.
Economic Conditions
Fort Collins’ economy is thriving, driven by its growing tech and healthcare sectors. Companies like Intel and Woodward Inc. continue to attract a highly educated workforce, contributing to a 4.7% rise in median income year-over-year. Retail sales have increased by 6.1%, reflecting strong consumer confidence. However, construction costs are up 5.8%, adding pressure to new developments. Despite these challenges, the city remains a top market for real estate investors seeking stable returns.
Market Rating: 7.9/10
This market is definitely a suitable choice for investment so long as you have the capital to afford the properties in the area with the high interest rates tacked onto it. This market shows great growth for the upcoming years and will show greatly in the overall economy.
Key Takeaways:
Market Snapshot: Fort Collins boasts a 6.3% YoY price growth with a median home price of $525,000.
Deal of the Day: A Westwood 8-plex generating $16,000/month in rental income at a 7% cap rate.
Tip: Focus on value-add opportunities for quicker equity growth.
Investment Strategy: Tenant-in-Common agreements allow co-investors to maximize purchasing power.
Interest Rates: 30-year fixed mortgage rates are at 7.0%, favoring rental property investors.
Economic Conditions: Fort Collins’ tech and healthcare sectors are fueling job and income growth.
That’s All For Today
I hope you enjoyed today’s issue. If you have any questions regarding today’s issue or future issues feel free to ask. Come back tomorrow for information on how to grow your income and wealth. I hope to see you.
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Disclaimer: This newsletter is for informational and educational purposes only and reflects the opinions of its editors and contributors. The content provided, including but not limited to real estate tips, stock market insights, business marketing strategies, and startup advice, is shared for general guidance and does not constitute financial, investment, real estate, legal, or business advice. We do not guarantee the accuracy, completeness, or reliability of any information provided. Past performance is not indicative of future results. All investment, real estate, and business decisions involve inherent risks, and readers are encouraged to perform their own due diligence and consult with qualified professionals before taking any action. This newsletter does not establish a fiduciary, advisory, or professional relationship between the publishers and readers.
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