How to Buy Your First Rental Property in the Las Vegas Real Estate Market

Trina Colon (00:00)

We have a lot of new construction out here. and there are actually whole developments that are being built and the developer is saying we are not selling them. We are holding them as rental properties, which should let everybody know when is the best time to buy a property, which would be yesterday. because we are seeing that the most likely people are going to be, you know, understanding that there’s a finite amount of property available in in places like this that are just growing, co going from, you know, a a place like Las Vegas into a more densely populated urban area.

Dylan Silver (02:14)

Hey folks, welcome back to the show. Today we’re joined by Trina Colon, a Las Vegas based lending professional, investor, and flipper. Trina, thanks for taking the time today.

Trina Colon (02:25)

Thanks for having me.

Dylan Silver (02:26)

Now, when we talk about investing in Vegas specifically, there’s so much happening in Vegas, and so much more now, I think, than really ever, and the intention of the whole country is on Vegas. If folks are looking at deals in Vegas, are there any specific areas or neighborhoods that you like to look at deals in?

Trina Colon (02:46)

Look at deals in any part of Las Vegas. the entire valley is is really growing and expanding. We have seen year over year increases all over the entire valley. So as long as the math works, right? You got to buy it right, get the good deal on the way in, then I’m open.

Dylan Silver (03:06)

Now, when folks are looking for fix and flip opportunities, oftentimes there’s got to be some type of distress, either as far as structurally or even the seller distress, right? That could be death, divorce, you know, or simply, you know, not wanting to hold onto this property any longer for whatever reason, needing to move, right? What is a typical acquisitions price that you’re seeing as a flipper for someone who’s looking to buy a a fix and flip opportunity in Vegas. I know there’s gonna be a range, but what might that look like?

Trina Colon (03:39)

I mean, we’re not really seeing people able to pick up property probably like under two fifty. I mean, it’s just that’s kind of like a a threshold point of property, you know, what’s available out there. And then you know, we can find good deals all the way into the millions.

Dylan Silver (03:59)

Now, when you’re looking for these opportunities, are you very intentional about seeking out, you know, those distressed sellers or is it many cases, you know, referrals that are coming to you, whether that be from friends, realtors or, you know, past clients that know you as an investor?

Trina Colon (04:14)

You know, over the years it’s been everything. people, you know, trying to find a solution because they themselves are sitting in some kind of distress and looking for you know, wanting to offload the property quickly for whatever reason. and then obviously the the foreclosure market.

Dylan Silver (04:31)

Now, pivoting here, you are a lending professional with lots of experience and it seems like this is a space that’s always changing, right? And no two lenders are alike. But one of the interesting things that I’ve noted from previous podcast guests is lenders who’ve been at this, not just for the current cycle and not just for the previous one, but for a sustained period of time, you know, before two thousand eight and the global financial crash. These are almost few and far between. So as someone who’s seen multiple cycles, what has been like the biggest changes that you’ve seen over that time period in the lending space?

Trina Colon (05:58)

Obviously the the crash was pretty traumatic for everybody who was, you know, working in this profession. I had gotten into this many years prior, so we we saw the whole deregulation of lending, and that was pretty crazy. and then we saw the unfortunate effects of all of that deregulation through the crash and there were a lot of people who just did not survive this business. we saw in Nevada, I believe the numbers were about 32,000 licensed loan officers the day before they instituted the required testing, as the, you know, all of the fallout of the crash. and the following day it was under 1200. so instantly we lost about 31,000 thousand loan officers in in one day with that licensing requirement. And it was a a slow incline of people coming back into the field. So yeah, we’ve we’ve seen some pretty dramatic swings.

Dylan Silver (07:02)

You know, one of the things that’s been challenging for a lot of folks who either are first time homebuyers or, you know, trying to get into the on-ramp of becoming a real estate investor is it seems like there’s so many hurdles to jump through that sometimes, you know, you’ll get multiple different opinions from different lenders. And I have this experience on a personal note, you’ll go to a lender and it’s like they can’t tell you anything unless they look at your credit. So sometimes people are like, Well, I don’t even know where to start. Where do I start? Right. For someone who may be either on that on ramp to home ownership or would maybe like to become a real estate investor, is there any broad strokes advice that you can give folks to to make that a reality?

Trina Colon (07:42)

You know, be proactive about what your financial picture looks like. know what your credit looks like so that you can have those conversations with a with a lender. know what your you know your basic credit score is, look at what your income is. you know have a good idea about your assets so that when you’re having these discussions you can t give them the numbers and you don’t have to necessarily go through that full application. I know that some companies like that’s the protocol they’re just trying to get their loan officers to get an application and that’s probably not who you are going to be getting a lot of options from, right? You want to be able to sit down with a professional who can have that discussion with you and go over, you know, some potential different options and different ways of of making it work out.

Dylan Silver (08:26)

You know, there’s a lot of consultation that happens, especially for folks who would like to become or or are investors and trying to acquire additional properties. One of the loan products that I’ve heard a lot about recently is DSC, right? Debt service coverage ratio. And when we start to talk about these types of you know alternative loan products, I do see more consultation happening. What’s been your feedback seeing the the rise of products like DSCR and bank statement loans, et cetera?

Trina Colon (08:57)

So you know, we used to have a fully stated income, no income investment loan program back in the early two thousands. So seeing some of this light documentation options coming back for the people who actually could could utilize them is it’s great. And it it has gotten people more interested. There’s obviously gonna be some give and take with all of that, right? The less documentation normally the more down payment people are looking for. So we just have to see like where a person is at and how how to get them into their first place. Most of the time they can kind of get themselves rolling after that. and I I actually have been looking really at the young people who feel like they cannot get into real estate at all and try to create an educational package for them, which shows them how to go from rental, renter to landlord, and potentially be able to leverage the rents in multi-unit properties to be able to help them qualify for their first purchase, which is, you know, a big leap. It does take a lot of intestinal fortitude to go from renter to landlord. but it is one of the ways where people can actually still be able to become an owner in really high price markets.

Dylan Silver (10:54)

This is very interesting, right? So this is this idea of, you know, not just house hacking, but buying a quadruplex and using the projected rents of the three other doors in order to justify your mortgage on the property, right? If we can get a little bit granular here, Trina, I’d like to maybe let’s not give away all of the gold, but a little nugget for our audience. You know, when folks hear this and they hear, you know, I’m not gonna qualify by myself, but I can buy you know, a potentially more expensive property that has three additional units in it, and then I will qualify for that, it it might almost confuse them ’cause why would that be? Help break this down to our audience.

Trina Colon (11:36)

So you know, in in many markets, especially like really dense urban areas, you might find a single family house that is comparable in price to a multi-unit. and so if you are a first-time home buyer and you’re just looking at a single family house going, hey, I can’t afford that, there is some potential to go, hey, maybe if I increase my my purchase price a little bit, I could then have the rents from those other properties is kind of helping me make this mortgage payment. It is, again, it’s it’s it takes planning. obviously, it’s going to continuously, you know, take some management about the finances, the rents, et cetera, having a pretty good understanding of the kind of market. Not all markets are the same for landlords. there’s definitely some very different rules from place to place, municipality to municipality, about being a landlord. But for the most part, you you know, this is gonna be a property that you would own or occupy in one of the units. so it kind of takes away some of that that separation from the people that you’re working with. But yeah, it is it is a little bit of a mental hurdle because you’re looking at that debt, going, hey, this is a pretty big nut every single month. but then you would need to understand like, hey, I’m I’m I’m potentially going to be having additional income coming in on that.

Dylan Silver (13:02)

You one of the things that I’ve seen happening quite often in the Sunbelt specifically is there’s a lot of new construction happening, right? And so sometimes this can be quite cost effective, surprisingly so. is this happening in greater Las Vegas Metro as well? Are you seeing subdivisions go up out there or is that happening less less frequently?

Trina Colon (13:23)

We have a lot of new construction out here. and there are actually whole developments that are being built and the developer is saying we are not selling them. We are holding them as rental properties, which should let everybody know when is the best time to buy a property, which would be yesterday. because we are seeing that the most likely people are going to be, you know, understanding that there’s a finite amount of property available in in places like this that are just growing, co going from, you know, a a place like Las Vegas into a more densely populated urban area. and the builders are seeing, you know, into the future going, hey, we’re we’re not going to just get rid of all of our land. We’re going to be holding on to it.

Dylan Silver (14:14)

You know, that’s a very interesting point you bring up. traditionally it’s always been build to sell for the most part, right? But now you’re seeing build to rent. And this is a huge undertaking from a builder, because remember the builder foots the cost to get the utilities out there. The builder has to do all of the legwork that sometimes people think the city might have to do. No, it’s the builder that’s actually doing all this. So then to hold on to it, you really have to have some deep pockets in order to do that. When we talk about these rental communities and then also the new communities that you see going up that are build to sell, are most of these, you know, on the more cost effective segment or are some of these like what would be considered luxury homes?

Trina Colon (14:58)

it you know, they’re trying to obviously span the spectrum. So we have, you know, properties that are going up on, you know, multi-million dollar lots here in Vegas. We also have properties where that they’re trying to hit that median housing price. I still feel like people will probably get the most bang for their buck by by going with a resale.

Dylan Silver (16:02)

You know, the resale thing is interesting because i it does depend on where you’re at. I mean, when I was in Texas just two weeks ago, you would see homes that were literally, literally a hundred and thirty thousand dollars with the land included out of the door. That’s after all of the closing costs, right? And so you’re almost not gonna find any flipped home that’s gonna compete with that, right? But then you go to some other markets, they call it the parentheses, the east and west coast, and you’re pretty much just gonna have to be looking at a pre-owned home. And Vegas is interesting because it’s growing, and I mentioned at the top of the show, it’s got like the eyes of the country on it. It seems like more and more people are looking at that as a place that they want to to live, right? I’m wondering what that is like as someone who’s been out there for for quite some time. Are you seeing now more and more like quote unquote Vegas transplants, people from all across the country who are making Vegas their permanent home base?

Trina Colon (16:57)

You know, when I came out here, it was a much smaller city. So that has just continued to happen year over year, people coming in from everywhere. We have a a lower cost of living than like California, Hawaii. So we have a lot of people coming in from there. obviously we have people from the Midwest who are like, no more winners. and so then they come out here. so it is w we are always getting people from all over the country. Which is great because then they also bring, you know, all of those great parts of their community and culture from all over the place into Vegas, which is fantastic. But it it’s kind of always been that way.

Dylan Silver (17:36)

Now when we talk specifically about moving to Vegas and not just, you know, being able to move out there, but also the process of selling your home and some of these other areas that you may be living in, is there a whole, you know, relocation industry that you’ve seen and have you, you know, been on the the lending side of this where someone is moving across the country and, you know, it’s a lot of moving pieces, somewhat chaotic, but ultimately when they get there, of course they’re happy. What’s that like as a lender dealing with that portion of it?

Trina Colon (18:06)

some of it it’s, you know, a lot of education, a lot of hand holding, you know, being being a resource for all for your customers and just having, you know, a lot of people inside of the community that we can know and trust and be able to refer out to those folks. I’m part of a number of different referral groups for that very same reason because people will always be asking me for all sorts of things as they’re coming to a brand new place and trying to get established. And you know, from the lending side, there are some specific programs, like if you’re transferring with a Fortune 500 company or in the military, there’s some ways that that that functions differently. and we, you know, we have Nellis Air Force Base and then we have another air another base in Indian Springs. So we do have quite a bit of military population. and we do a lot of veteran loans. So, you know, it just it it depends.

Dylan Silver (19:01)

Now, for folks who are looking at better understanding, you know, where their first investment opportunity should be, and maybe they’re living in Vegas or maybe they’re considering a move to Vegas and maybe they have a home elsewhere in in the market that they’re presently residing in. How would you approach it? If you’re deciding where to to make your first investment property, should it be in your backyard so you can go in on check on it? Or should it be you know in an area where maybe the acquisition costs are lower than where you’re at if you’re in, let’s say, you know, New York or California.

Trina Colon (19:34)

I I always say that you gotta, it’s like the lottery, right? You gotta be in it to win it. So you have to figure out where you can purchase, right? Some people are priced out of some of those coastal markets as for just investment purposes. but you know, it’s obviously better if you A can drive over and check on a particular property. You know, second best thing would be to have a a group of trusted people, right? Trusted property managers or agents that you could, you know, ask about what’s going on with the property, people who won’t, you know, be trying to pad any kind of repair bills on you, et cetera, and give you the real deal. you know, having been in this predicament, investing in property all over the place, that is that’s the make or break. I’ve had great people. I’ve had people who, you know, were unfortunately trying to line their pockets knowing that I wasn’t around the corner to be able to come by and look. Eventually all that stuff comes out in the wash. It’s just, you know, that you don’t want that to be your first deal. Most of the time people are working like with, hey, here’s my budget. I have a finite amount of money to be able to put into some kind of real estate investment. and they want it to go as smooth as possible. So, you know, research. And hopefully as close as possible, someplace, you know, that you would be able to go to, able to travel to and have people that would be able to help you.

Dylan Silver (21:05)

Let’s talk about that a little bit, you know, finding good contractors and subcontractors and then managing a project. What’s been your secret to success, you know, when managing a flip?

Trina Colon (21:16)

it’s it’s an organic process. you feel like just when you feel like you have everything all dialed in, you know, people have their own lives, you know, folks that you’ve worked with before on a different project, it might be someplace else and you need to, you know, f find new folks and learn new rules about how to function there. So it’s never boring. It’s always a challenge to try to quarterback that altogether. But ultimately, I would say it is just being diligent. And you know, it it it’s the same, it’s the same thing where people are like, get three bids, right? I’m still doing that from people that I have worked with for a long time. I’m like, okay, great, right? Just get into the habit of constantly double checking your own work making sure that, you know, yeah, prices change, materials change. I mean, during COVID, we would have huge swings on material, and you’d it it was a surprise, an unfortunate surprise. You’d be like, what? stuff doesn’t cost that much. And you’d you know, you always checking, always making sure that you’re applying your diligence, making sure that the people that you’re working with are competent, licensed, all that jazz. and it’s it’s a a an everyday thing. So yeah.

Dylan Silver (22:31)

We are coming up on time here. anything you’d like to mention directly to our audience?

Trina Colon (22:36)

Yes, I would love if anybody has any questions, they could go ahead and go to my lending website, which is trinacolon.allwestern.com. and they could find a means of making loan application there. You can also follow me @trinacolon_ on Instagram. We do a lot of additional projects. we I make independent films and I’m actually doing a one woman comedy show in New York off Broadway in October. So if you want to follow not just finance and real estate stuff, you can check us out on that Instagram page and I post all of the all the amazing things that we’re involved in. So

Dylan Silver (23:22)

Trina, thank you so much for your time today. Thanks for joining us. Thank you.

Trina Colon (23:25)

Yeah. Have a great one.