New to Real Estate · South Bend, IN · Member since 2015 · 8 posts · 1 vote
Real estate business is hard especially multifamily. I am on the crossroads of just selling everything and moving into REITS, Index funds or dividend investing now that markets are low. Heres a little background on me:
* I have a full time job as a PT
*I own and manage myself an 8 unit multifamily in Buchanan MI and 1 duplex in South Bend IN. Used to have a property manager but has moved away. Having trouble getting a trustworthy manager. The 8 unit cashflows $1100 after debt service and duplex cashflows about $250 after debt service.
* i have 3 small kids
* recently injured my knee and on crutches and property is a 25 min drive away.
Things are getting overwhelming and im ready to sell. What are your thoughts on this? If you are in my shoes would you sell? I was hoping to sell the 8 unit for 200k and the duplex for 140k.
@Kris Jumao-as
It seems like you are just getting a little stressed out for nothing. You obviously got into the realestate game for a reason and even though the road is a little bit rough right now I think you should just take a deep breath refocus yourself and everything should be OK.
At least your are cashflowing right now and hopefully your knee will get better and you will get off crutches and you can get back to maintaining some control over these properties so I don't see a reason to have a fire sale right now.
And I agree with you property managers suck and they are not trustworthy so I would not get back into that, I would continue to try to manage them yourself, stay positive. To be honest when things get a little bit overwhelming for me, I go buy another house..somehow it recharges me and gets me excited again.
Just my two cents!!
Have you thought about hiring a property management company to manage the units for you? It sounds like you don't have the time/energy to manage the properties yourselves. Maybe a good property manager could take all that burden off you, and you could just collect checks. If the numbers don't work with property management, then maybe time to sell...
I think your struggle is one of scale. Have you thought about syndications? The return dwarf REITs and you learn a lot about the bigger multifamily business. DM me if you'd like to talk more. I feel your pain on the small stuff. I wrote a blog post here about why I don't like buying the smaller properties.
@Kris Jumao-as
It seems like you are just getting a little stressed out for nothing. You obviously got into the realestate game for a reason and even though the road is a little bit rough right now I think you should just take a deep breath refocus yourself and everything should be OK.
At least your are cashflowing right now and hopefully your knee will get better and you will get off crutches and you can get back to maintaining some control over these properties so I don't see a reason to have a fire sale right now.
And I agree with you property managers suck and they are not trustworthy so I would not get back into that, I would continue to try to manage them yourself, stay positive. To be honest when things get a little bit overwhelming for me, I go buy another house..somehow it recharges me and gets me excited again.
Just my two cents!!
@Mike Krieg Thank you for your insight and the blog post. I am totally unfamiliar with syndication and now just starting to google about it. It seems like Realtyshares is the only big dog company for this right? Syndication is very interesting to me and again thank you. By the way how much capital does it take to get into this?
@Mark Fries@Daniel Kong Thank you for the kind words and advice. I doubt i will get a trustworthy property management in this area as the nearest Bigger city is 15-20 min away and i fear my property will be neglected by the company. I might hang onto them and see how it goes for the next 3 months. Unless someone makes me a good offer
@Kris Jumao-as the overwhelming advice here may be to keep the properties and make it work. But of course this is a real estate investment website, so that is the expected advice.
I was in a similar situation where I had a 6 unit apartment and duplex. Cash flow was great, but the tenant issues and old building maintenance were draining the life out of me. They were C class properties. I ended up moving my portfolio to single family homes that are B class and my situation improved.
The other factor here is when you have children in the mix, you just don't have as much extra time. When were DINKs (Dual Income No Kids) back in our 20's, it was no problem dealing with the properties. People totally underestimate how kids change your life - not only from a time standpoint but also the fulfillment they bring. So with kids, time is more limited. It is very important that you have good systems and/or a good property manager.
My final comment is that if it is all too much, if your family is suffering over the properties, then it is OK to sell the properties. There is no shame in moving to a more passive investment to free time to prioritize your family. The worst thing you can do is hold on to something when it is not a good fit for you.
“Giving up” isn’t the right thing to do, however making a sound investment decision is.
Were your children or anyone to ask me some years later, what would you like said of your handling of the matter? Honorably, admirably is the correct response of course.
Our slogan contains three “honorable” synonyms “…Legally, Morally, Ethically.”™ So, addressing our minds from this premise, we may conquer challenges in ways unavailable from a negative space.
Negotiating from a position of unfair advantage doesn’t permit negative aspects. You can do anything you set your mind to do. Chances are that’s how you got here.
What small course corrections along the way – researching, negotiating, acquiring, cash-flowing and now disposing of your investment could you have made to avoid your predicament? And humbly, gratefully, thankfully you’ve asked for other professionals’ opinions.
Good job! Now you’re here. Don’t give up five minutes before the miracle. Hustle harder – even just a little more may do it – I don’t know your particulars. Set small easily-achievable goals and keep your focus relentlessly on them. Measure your progress, reward yourself for even tiny successes.
Watch YouTube videos – Bigger Pockets, *************, Grant Cardone, Ted Talks, Dan Lok, Tony Robbins, Robert Kiyosaki, etc. and don’t stop until you’re succeeding in creatively maneuvering yourself – better - leveraging yourself into a better position.
You can do it, somehow you will find a way. Some folks want to have what you’ve built for yourself, with a few adjustments. So, who can partner with you? How will you promote it? What will it look like?
You have positive cash-flow, I'd keep it.
Paul's LLC, “Doing The Right Thing Legally, Morally, Ethically Or We Don’t Have A Deal!”™
There are times and seasons for everything! Thought I’d love the restaurant business! Bought one and in 3 years was burned out .... sold it and made a profit! Now I’m buying a rental and excited about it. Sounds like you definitely need a break.....just because you get out- doesn’t mean you have to STAY out. Take some time off and evaluate it. You can always buy more!
@Kris Jumao-as Do not give up ,you are in the right business and businesses are not based on One person .Successful people do not become successful easily ,they have to fail before they succeed .Keep trying and you will find the one you are looking for.