For those of you that started out with SFR or MULTI properties at what time/point did you decide to go commercial? Was there a certain time when you decided to jump into larger units? What made you make the change? What would you do differently?
I went commercial in 2009. The reason was the last recession. I have bought and flipped over 400+ properties in Chicago, Denver, Socal, Las Vegas and Phoenix. I went into building single family houses of which I built about 20 in Socal. When the recession hit, it was hard to continue building and the market for contracting services was tough, as most people went upside down on their houses. I went into commercial lending as the deals are bigger and the borrowers are more professional. You will know when your time comes.
Perfect answer Mark. Perfect.
Thanks for the compliment. How is the Las Vegas market doing? I used to have a second home in Laughlin Nevada.
@Mark Creason that is exactly what I was looking for. I want to get into apartment complexes eventually but am starting small to build up capital.
Ryan D. to answer you question on a previous thread I am on the North Side, Portage Park, Albany Park and Lincoln Square) . Once I hit 5 I cannot do a cash out refi on any of my properties except my primary so I felt I would be shooting myself down the road but taking that option off the table. So the rest of my properties (in a cash flow only market) are financed commercial. I have over 10 so I would have had to go commercial anyway
Having closed on my first commercial deal just 2 months ago - the process was much easier. From the time we finally got the p&l from the seller and submitted the file it took 3 days to get the loan approved.
We went into retail/office commercial after about 5 years in SFH rentals. I hated getting the complaints from SFH renters that they hate the paint color or the light fixture looks old, etc. By the way, this was after they signed the lease. I didn't comply with all the demands but it drained me. Luckily I bought a retail place kind of by chance and really loved the NN or NNN leases. Businesses tend to also be less emotional and more professional. They tend to understand that it takes more than an hour to fix the AC. In my experience just less demanding and more reliable. It just fit my personality better. Then after I realized forced appreciation, I switched for good.
Ryan D. I had four homes and saw slow wealthy building but wanted to go larger, faster. Then I quit my job so I couldn't get approved for a mortgage and had to raise money (or partner with others) to do a deal. That made me look at multifamily.
Free eBook from BiggerPockets!
Join BiggerPockets and get The Ultimate Beginner's Guide to Real Estate Investing for FREE - read by more than 100,000 people - AND get exclusive real estate investing tips, tricks and techniques delivered straight to your inbox twice weekly!
- Actionable advice for getting started,
- Discover the 10 Most Lucrative Real Estate Niches,
- Learn how to get started with or without money,
- Explore Real-Life Strategies for Building Wealth,
- And a LOT more.
Sign up below to download the eBook for FREE today!
We hate spam just as much as you
Create Lasting Wealth Through Real Estate
Join the millions of people achieving financial freedom through the power of real estate investing