Worst Mistakes while investing in multi-family

[Amby Bhagtani]

To all the intelligent investors here, what are some of the worst mistakes you made and what would be your recommendations for a new multi-family investor to avoid those mistakes. 

[Rick Bassett]

We manage many small multi's - the most significant issues that we have are with trash policies, noise between floors, pets, and parking.

Trash is tricky as there is often a tenant, a neighbor, or a visitor that fills the waste receptacle up causing stress on the rest of the tenants...and sometimes us if they drop a tire, paint cans, furniture ...etc. 

Noise issues always come up; much has been written here about it. As much as we hate carpet, we try to put it in the upper units to dampen the sound but not the first-floor units.

Pets - we try not take them in multi's, but we can't easily avoid the army of ESA's, when possible we try to keep them located on the first floor. Pets & carpets aren't a good mix.

Parking - is always a contentious issue if you allow assigned or numbered parking spaces, as there will always be violators and angry people. We spell out how many cars tenants can have on the property and do not allow assigned or reserved parking. 

With all of the above, we aren't going to mediate disagreements between angry tenants. We tell them they need to work it out on their own or invite them to move out if they can't. Our mistake was getting involved with these squabbles in the past...no more.