Seller Credits and Self Managing: How to Cash Flow with High Interest Rates
Self-managing a property is not only a great learning experience, it can significantly boost returns, too. In this deal analysis, Jenny and Leah look at a recently purchased Pueblo duplex that cash flows even with a 7.25% interest rate! The clients’ decision to self-manage took the property’s performance from solid to stellar.

This deal analysis looks at a duplex in Pueblo.  Leah helped the first-time investors based out of Denver wanted to take advantage of the lower price points in Pueblo to find a multifamily property.  This is a great duplex cash flows even in a high interest rate environment.  Thanks to their decision to self-manage, they’re getting great returns.

Three Learning Options!
  1. Listen to the podcast “#109: Seller Credits and Self Managing: How to Cash Flow with High Interest Rates” on the Colorado Springs Real Estate Investing Podcast
  2. Watch the YouTube video (at the bottom.)
  3. Read the blog post. Note, the blog is an executive summary. Get the in-depth breakdown from the podcast or video.

Investor Profile

These first-time investors are a couple who live in Denver.  After looking at single family homes and townhouses, they decided to look for a multifamily property. 

Investment Property Details

This is a duplex with 3 bedroom/1 bathroom units, each about 800-900 sq ft.  It’s located in the south Pueblo area, just south of Bessemer, a popular area for our clients that’s very close to I-25.

Appealing Features of the Property

The front and back duplex has a unique layout, with the first unit being ranch style and the second having two stories.  Three bedrooms is rare for a duplex and will help the clients get better rents. 

The property was recently renovated, and they did a great job with the update. 

How Was the Deal Sourced

This deal was on the MLS.  Leah knew it would be popular, so they put in an offer the first weekend it went on the market.

Property Contract Details


The property was listed at $299K, but the listing agent told Leah that there was another offer on the table that was under list.  This was an easy decision—they offered at list price and quickly went under contract.

Inspection Issues

The inspection found quite a few issues, so Leah advised her clients to submit a rather large inspection objection to see if the sellers would negotiate.  Thanks to the shifting market, the sellers agreed to everything they objected to. 

Some of the issues included inadequate insulation, live knob and tube electrical wires in the attic, and radon.  The seller took care of the electric and insulation work, and gave the buyers $5600 in concessions along with a slight price reduction to assist with correcting the other issues.

Property Financing Details

I used the Rental Property spreadsheet to run the numbers on this deal.

Property Overview

Property Overview spreadsheet screenshot for Pueblo duplex

The interest rate is a whopping 7.25%, which the clients were lucky to lock in before the next rate hike.  Thanks to the seller concessions, they were able to buy down some points. 

While they expect $1250 in rent per unit, Leah and I ran the numbers conservatively at $1200. 

Property Operating Expenses

Monthly Operating Expenses spreadsheet screenshot for Pueblo duplex

The clients are self-managing to save money.  Since they live in Denver, it’s a bit of a drive, but they’re excited to be hands-on landlords and learn more as investors.  Leah gave them the phone numbers of reliable handymen in the area to make it easier for them. 

They are going to institute a utility bill back to the tenants so they won’t need to worry about utilities.

First Year Returns

First Year Returns spreadsheet screenshot for Pueblo duplex

Even with a 7.25% interest rate, the yearly cash flow for the property is $3400, and the cap rate is 7.2%.  These numbers are helped because the clients are choosing to self-manage, and they were able to save a significant amount of money thanks to the inspection objection. 

To see what the property will look like if the clients choose to get property management, we ran the numbers again. 

First year returns spreadsheet screenshot for Pueblo duplex if the clients hired a property manager

Even with the 10% management fee, the property breaks even for cash flow and the cap rate is still 6.2%.  While we can’t predict the future, it’s possible they could eventually refinance into a lower rate and see the same returns using property management that they’re seeing right now. 


This deal shows that even with high interest rates, investors can still find properties with strong returns.  It’s important to look at all of the factors that go into a deal, not just rates. 

Connect with Us

My philosophy is that if the numbers of a property work today, then there’s a high probability of long term success regardless of what happens in the market (assuming you budget for contingencies as well!)

If you want to find your own property in Pueblo or Colorado Springs, reach out to us for a free investment consultation.  We’ll be happy to run some numbers and find the right property for your goals.

YouTube Video

How to Cash Flow with High Interest Rates

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Start analyzing your Colorado investment properties today
Rental Property Spreadsheet • House Hacking Spreadsheet BRRRR Calculator Spreadsheet • Fix and Flip Deal Analyzer Investing Maps • Rehab Pricing Estimator
Jenny Bayless
Jenny Bayless is an investor-friendly agent with Envision Advisors, Colorado real estate investor, and the host of the Colorado Springs Real Estate Investing podcast.
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