Multfamily Real Estate is NOT Profitable - But I Know it CAN Be

[Jason Reinhardt]

My wife and I have been saving for 14 years - hard - we own two SFH rentals outright and are trying to get our start into multifamily. It seems every property I throw into my calculator is not profitable on day one unless you raise rents $100 (or more) as soon as you take ownership. Here is an anecdote - a four-plex 5 minutes from my house is on the market for $360,000 and the net profit last year was slightly over $10,000. We are looking in Kentucky and southern Ohio for properties without much luck. We have a $200,000 down payment budget. Any suggestions for better markets?

[Paul Moore]

Quote from @Nathan Gesner:

Have you considered self storage?

I bought an off-market self storage facility just over a year ago. Paid $550,000 for it and my monthly gross is almost $10,000. You won't find a residential rental that costs so little and nets so much. I also manage it myself with no more than 4-5 hours a week.

 @Nathan GesnerI wholeheartedly agree! Hi @Jason Reinhardt, here is a funny little story. I built my first multifamily facility in North Dakota in 2011 and the next one the following year. After several years in the multifamily arena I promised my wife I would never do anything else. I am in my 50s and I have been investing in real estate for over 20 years. I wrote a book on multifamily investing and even dared call it the The Perfect Investment . But after years of banging my head against the wall with similar experiences to yours, we switched to self-storage and mobile home park investing. There is so much more upside and if you can acquire the right facility it is likely to be quite profitable. Not all of them are. PM me if I can assist you and feel free to check out Storing Up Profits, a BP book that was published last year. Happy investing!