They say that the Manhattan property market has been in a correction for a year already. Some think that will keep spreading—though many say we won’t face another crisis like 2008. Whether or not you’ve experienced a correction, there are things you can do now to mitigate risk when it happens. Here’s what I do.
Browsing: multi-family investing
As much as we wanted to move forward with the deal, the numbers told us to pass. It was hard, but the best deals oftentimes are the ones you walk away from.
If you look hard enough, you can find real estate to buy in just about any market in the world. Still, there are warning signs that exist in each market that might indicate it’s just not a good idea to invest there.
One of the most significant steps in finding multifamily deals is swiftly sifting through leads to know how much they’re worth and which are worth pursuing.
Due diligence makes all the difference between landing great deals and being burdened with duds. Use this checklist to cover your bases.
It’s not as easy to find deals today as it was just five years ago, but it’s still possible. You just have to know where to look and who to contact.
More single family home investors appear to be graduating to the multifamily property space. Why is that? What’s drawing them to this niche?
Last year, I began adding apartment buildings to my portfolio. While there are similarities to single family investing, there are some new quirks to learn.
There are passionate advocates for both of these types of properties. How do they really stack up? What are pros and cons of each option?
I recently closed on my first apartment building. In case you are considering investing in one yourself, here are my biggest takeaways from the process.
I like multi-family properties. I like single family properties as well. Both are great investment…
- Prices are Falling — Prices for apartment buildings are steadily dropping. Many apartment building owners paid way too much for their properties over the past few years and now their properties are worth less than what they owe. Apartment buildings are starting to show up as foreclosures across the country and it is further pressuring prices to the downside.
- Forced Appreciation — You don’t have to wait for real estate prices to go back up to increase the value of your apartment building investment. You can increase the value of you apartment building by increasing the rents, cutting your expenses or by making physical improvements on the property.
- Less Competition — Many investors are under the false impression that owning an apartment building is more difficult than owning single family homes, therefore their is less competition for prime properties.
As investors, we’re always looking for ways to increase the value of our properties. Most of us are familiar with the more conventional ways of doing so: decreasing expenses and increasing income. What if I told you it was possible to increase income without raising rents or decreasing expenses? Let’s explore a few ways that is possible.
Increasing Value with Vending Machines
If you own a fairly large complex, it would make sense to install a vending machine. Assuming you’re an expert of your market, you could effectively target your tenants by placing products you know your tenants would want in the machine. The best place to put your vending machine is in an area that generates a solid flow of tenants; the laundry room or near the pool (if you have one and your property is located in warmer markets) are two good choices. Even modest vending revenues increase the property’s value significantly. Assuming the property is in a 6% Cap rate area with yearly vending revenues of $720, you would have increased the property value by $12,000! Not too shabby given our modest revenue assumptions.
Tapping rarer, but more lucrative, value potential