New Investor Checklist

[Chris Papa]

Hi - I am new to BP and Real engage investing. I’m in the process of looking at some multifamily properties to potentially purchase. What questions should I be asking the brokers about each property I am interested in? Is there a “checklist” of questions you ask every broker to answer? Any help is appreciated! Chris Papa

[Ben Biggs]

Hey @Chris Papa

This is my wheelhouse. 

I'll break it down for you. 

1. Pre-approval. Before you can begin shopping you have to know what you can afford. Units change things up because you can account the income of the units into the pre-qual amount so you have to identify several potential properties and check the numbers. It's a sliding scale. 

2. Get real. You have to be honest about what kind of return you're expecting. I know this market, you're in San Diego ( I'm assuming you're buying here) and this is notoriously known as a "break even" market. That's my general yardstick. Break even + 5-7 year minimum hold time + no deffered maintenance + San Diego's great historical appreciation = Solid opportunity. 

3. Work closely with an investment minded Agent/Broker. Have your deposit ready. Have your lender lined up. your Agent will need to know what kind of financing you will be using (VA, FHA, Conv).

4. Be ready to move quick. 

5. Trust But Verify. 

BiggerPockets spreadsheets don't work in California. 2% rule, 50% rule, etc. Throw all that away. Doesn't apply here. Go for break even at least and try to get the best deal you can. If you're cashflowing $100-$200 a month you are WINNING. 

It's not terribly difficult - just start putting your team in place. 

Let me know if you have any further questions. 

-Ben