Buy or wait multi family

3 Replies

Hi Guys,

I have been looking for Multifamily deals for a while now but nothing came across with good returns.

My questions are

what constitutes a good return for you guys 6% CAP Rate the Norm now?

should I start small 5 to 10 doors or go big 200 Plus

let me know what do you guys think and how did you guys start.

what to look for as a value-added and how to spot good deals

thanks for all your help in advance 

thanks

Hey Johnny great job on wanting to get started! From what I've read buying a residential property (1-4) is easier to obtain financing on. Have you considered starting with a 4 unit, gaining experience and then going multifamily? Good luck!

If you have no prior experience, then 1-4 is the way to go because lenders will be hesitant to lend you $$ on a 200 unit deal.

If you want to get into a bigger deal, partner up with someone more experienced.  

Or if you have experience, then go for larger deals as long as the cash flow numbers work out!

@Johnny Khoury As noted by @Paul Choi You need experience to get into larger  MFH deals. Alternatively you can find an experienced partner and bring a deal to them. 

Starting with a residential MFH (up to four units) will also allow you to get regular financing, although under your personal name. You can definitely start with 5-10 doors as you mentioned. You just need to simultaneously start talking to lenders to find out what the requirements are and get that lined up.

Best!

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