Multi Family Conversions

[Jessica Monroe]

I'm looking to purchase my first multi family property and have a seen a few conversions on the market. I've heard to stay away from conversions as they are hard to pull equity out of or sell. In general, if the numbers are right and cash flows does conversion still = red flag? 

More specifically, this property is O-1 zoning so might even be worth more to tear it down in upcoming years?

My long term goals are to buy and hold rental properties focusing on multi families. 

Thanks to everyone in advance for you feedback!