How to Scale to Multifamily in 3 Simple Steps (& Why You Shouldn’t Be Scared!)

How to Scale to Multifamily in 3 Simple Steps (& Why You Shouldn’t Be Scared!)

4 min read
Ashley Wilson

Ashley Wilson is an avid real estate investor from the suburbs of Philadelphia. She owns several real estate businesses and focuses primarily on the operations of each business.

Experience
Ashley began her real estate career investing in short- and long-term rentals. She then started flipping houses in the suburbs of Philadelphia, while living in Europe. Upon her return, she moved into large multifamily.

Over her tenure, she has been involved in over $40M of real estate and has overseen over $5M in construction. Today, she focuses on both flipping houses and operating large multifamily properties, as the Asset and Construction Manager.

Press
Currently, Ashley is a contributing blogger to BiggerPockets. She also was on BiggerPockets Podcast episode #277 and previously provided live content for BiggerPockets YouTube and Live Stream.

Ashley has also been featured on several podcasts, including The Real Estate InvestHer, Purchase to Profits, Best Real Estate Investing Advice with Joe Fairless, The Real Estate Syndication Show, The Multifamily Zone, Multifamily Marketing, and Cashflow2Freedom. In addition, Ashley has spoken at several real estate events including IMN Multifamily Property Management & Operations, MidAtlantic Summit, Diversified Investors Group, The Real Estate InvestHer, and Strategic Investor Alliance.

Education
Ashley attended Colgate University and then later received her Masters of Leadership Development at Penn State University, where she was inducted into the Beta Gama Sigma Society. Ashley also holds a Six Sigma Lean Professional Certification and an Independent Rental Owner Professional Certification from the National Apartment Association.

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The time has come, and you are finally ready. You have spent so much time accumulating houses, but you still do not feel any further ahead than anyone else.

It has been a rollercoaster ride, good luck and bad luck going hand in hand. The cash flow on a couple of your properties has been great, but you keep getting hit with house payments, taxes, and repairs. A brief stint in jail did not help either, and even being chairman of the board has been costly. But it is all about to pay off!

The Scottie dog just rolled a six, and he owes you big time. You now have enough cash to put that red hotel in the perfect location. The game is not over, but you can feel it.

You have just won!

As a kid, my favorite game was Monopoly. That is probably where my fascination with scaling began. When I first started out in real estate, I assumed that apartment complexes were all owned by big companies based out of L.A. or New York. Once I learned that anyone can own a large multifamily property, I knew that was where I wanted to be. After all, while you can still win the game with a bunch of small houses, it happens a lot quicker with those big red hotels.

Multifamily investing, and even more so large multifamily, is not typically an investment people start out with. Most start by flipping houses, buying single family rentals, wholesaling, or some other niche in real estate. This may be due to the lack of understanding of how multifamily works or simply the complexity of this large of an investment. 

Like most people, I experienced a bunch of different aspects of real estate before making the jump. Looking back, I wish I had done so much sooner—especially since my plunge into multifamily boils down to just three simple steps. 

zillow trulia search

3 Steps to Getting Started in Multifamily Investing

1. Educate yourself.

I have to admit that, in the beginning, I was intimidated by large multifamily properties. Million-dollar checks, hundreds of tenants, the whole thing can be overwhelming. What got me past that mental roadblock was the amount of time I put into educating myself. 

I listened to numerous podcasts, starting with those more generalized (like the BiggerPockets Podcast) and continuing all the way to uber-specialized ones (like the Old Capital Podcast). I set up Google alerts and read every article I could find. Then, I ordered every book that the article recommended. 

I attended meetups, and I asked as many questions as I could. I wanted to be absolutely sure that this path was the right one for me. And in doing so, I was able to draw a better roadmap as to where I can fit in.

While in many cases jumping in the deep end and taking action is the best way to learn something, I knew I would be putting investor’s money on the line. I wanted to learn everything I could in the classroom before I took it out to the streets.

Related: Tips for Vetting a Multifamily Investment Property

2. Leverage experience.

Over the last year alone, I have amassed a level of knowledge that is unrivaled compared to any other year of my life. What I also learned is that you do not need to be an expert on everything.

When you buy a single family rental, you might end up funding the down payment, finding the perfect loan, managing the renovation, managing the tenants, and doing the repairs all by yourself. However, when the deal gets large enough, there is enough of the pie to go around that you can afford a whole team of people.

Don’t like raising money and managing investor communications? Find a partner who does. Only like finding deals? Partner with someone who will manage the asset. 

apartment-complex

In my experience, it is better to be really great at what you do than to try to be a jack of all trades and master of none. Personally, I have extensive knowledge and experience with project management and construction; thus, I look to partner with others who have complementary skills. 

Having 30 percent of a great deal will always be better than 100 percent of a flop. Leverage your experience, and do not try to be something you are not.

Related: The Ultimate Guide to Multifamily Financing

3. Network.

Finally, in my opinion, the most crucial part of being successful in the multifamily space is networking. As mentioned previously, multifamily investing is a team sport, and networking allows you to build your team or be “drafted” to another team. 

Another benefit to networking is evident in deal sourcing. Unlike single-family, there is no single listing source, like the MLS, for available multifamily properties. The majority of transactions occur “off market.” These transactions are a direct result of the relationships that you have cultivated over months and even years.

As the saying goes, “Your network is your net worth.”

The Bottom Line

Like most new ventures, investing in multifamily in its totality can seem daunting. While I may not have realized it at the time, systematically breaking down my entry into this new career path helped me get to where I am today. 

And although I may not own Boardwalk or Park Place (yet), I am slowly acquiring the right properties, with the right partners, to trade in our green houses for red hotels. 

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Do you have any questions for me about making the jump to multifamily? Or do you need advice that I haven’t provided here?

Let’s talk in the comment section below.