Multi-family, where to start?

Question

Hello --

We're interested in multi-family (commercial).  Is there any mortgage broker you could recommend for a MF newbie?

Looking for investment opportunities, somewhere between 1.0 - 2.9M.

Thank you.

Jason Wray · Answer

Chris,

I sent you a message as an introduction.  Great time to for multifamilies rents are high rates are dropping and values will continue to climb for 2024!

Nate Herndon · Answer

5+ Unit Multifamily can be tough right now. Sellers have low/no mortgages on their own properties, low rents compared to market, and high expectations for their sale price. All of that *can* be a tough recipe for a DSCR loan at max LTV (75-80% LTV).

We even had one major national private lender bail completely on their 5-9 Unit Multifamily product as of this week. There are many options available still, but 2-4 unit properties are easier to stabilize and obtain financing for right now.

Carlos Ptriawan · Answer

there're already so many deals (eg: cap rate 8-9%) these days....in san francisco market 5-9 unit MF dropped like 30% from last purchased price. If you purchase with longer term fixed debt you may see some values. I kept reading some apt is operating with DSCR 0.61x ; I bet there're professional buyer in line willing to buy those asset with large discount LOL

Chris Huang · Answer

Thanks Gino, will do -- I love your MF podcast!!!

Gino Barbaro · Answer

@Chris Huang

DM me and I will connect you to a mortgage broker

Gino

Chris Huang · Answer

Yes, understood - we're preparing for when/if that distressed opportunity does occur (2024-2026).  Not sure, of the lending standards or guidelines for commercial loans.  We'd  like to be prepare/ready for what is coming on the horizon.  Thank you.

Devin Peterson · Answer

Hi Chris,

There a ton of qualified commercial investment, focus brokers on BiggerPockets. I would recommend utilizing the find lender tab. What type of properties are you interested in purchasing seems to be going after a very specific asset class purchase price amount.

Multi-family, where to start?

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