Comments on: Apartment Building Investors Versus Apartment Building Speculators

By: Lance Forte

Lance Forte — Tue, 10 Jan 2012 00:47:44 +0000

is your friend open to mentoring via email or phone?

By: Eric

Eric — Tue, 27 Oct 2009 15:43:32 +0000

@Rick makes sense that an older aparment owner would be more interested in a continuing income stream than in a lump payment. Thanks for pointing that out.

My question for the group is that, if you are planning on buying an apartment and making some changes, like shaking up the renter mix and fixing up the units to get greater rent (hopefully), how do you both keep it conservative to factor in the unknowns as well as reflect the benefits from the changes you plan to make?
.-= Eric´s last blog ..3 Secrets to Reading Housing data for the Real Estate Investor, Part 1: Understanding Seasonally-Adjusted Data =-.

By: Bobby Drish

Bobby Drish — Fri, 28 Aug 2009 23:26:56 +0000

My closest friend cut BBQ in a kitchen before investing in apartments because 5 years ago there were books, available on Amazon predicting Wall Streets recent meltdown.
6 years later he controls 41 complexes worth $1Billion. He’s no smarter than you or myself. 16,000 people get up, go to work all for one thing – to pay him rent. .05% makes him $200k a month.
Now tell me buying any apartment complex is risky.
Far easier than buying a home. It’s easier to borrow $3million that cash flows on it’s own than a $300k house dependent on you keeping your job.

By: Ned Carey

Ned Carey — Fri, 26 Sep 2008 21:24:20 +0000

Rick Wrote:
>”Nice try people”

It sounds like you are disagreeing, but it is unclear who you are disagreeing with.

>One has to understand the mentality of the seller.

Agreed all negotiation starts with understanding your opponent and his or her needs.

>If that does not work, walk away.

Hmmm,that sounds like a contradiction. If that doesn’t work maybe you just haven’t found what the sellers true needs are.

By: Rick Linhart

Rick Linhart — Fri, 26 Sep 2008 16:50:42 +0000

Nice try people.

One has to understand the mentality of the seller. I have appraised real estate for 30 years in Cleveland, Ohio.

Many sellers are older or retied and who most likely made two payments a month to pay off their mortgage.

To sell is to part with that income stream. It is easier to pull the sellers teeth with an old pair of pliers. Also the old timer has to give the govt. 28% in cap. gains. Ouch

To cool the situation offer a purchase money morgage for a five or ten year period that maintains 3 points over prime.

Make sure to lay out the payments on paper and also put in your down stroke. These folks want to study this stuff overnight or give it two a CPA. If that does not work, walk away.
Rick Linhart

By: Investment Blog

Investment Blog — Thu, 25 Sep 2008 06:28:28 +0000

I think the real question is there enough renters out there to rent the apartments or does these renters want single family homes to replace the ones they lost in the subprime crisis.

By: steve jenings

steve jenings — Wed, 24 Sep 2008 05:30:41 +0000

Apartment buildings are difficult to value and all factors such as depreciation, vacancies and loan repayments should be taken into account.

By: Ned Carey

Ned Carey — Wed, 24 Sep 2008 02:44:21 +0000

>On the other hand there are other investors, who also lack the necessary knowledge to truly evaluate the investment potential of an apartment building but they have no fear at all.

I guess these would be the people who bid cap rates down to 3 and 4% in the recent past. How did they even get these bad deals financed?