Looking to purchase a multi-family investment

Investor · Scottsdale, AZ · Member since 2022 · 50 posts · 22 votes

Hello! I am looking to buy a multifamily home in the next year or so and wanted to hear some thoughts on a few things.

How well do small value add projects benefit the investment outcome in your experiences?

What cities do you see have a fair entry point that cash flows not in a crime filled area?

Does anyone have experience getting into partnerships on multifamily investment. Not opposed to bringing a partner in on a deal. I have a couple years of experience in managing 40ish short term rentals remotely & on-site, so I believe I could use a management incentive to lower my buy in.

Thank you!

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Ko KashiwagiPro Member

Lender · Los Angeles, CA · Member since 2022 · 967 posts · 445 votes

Hi Braeden,

What kind of purchase price are you looking at? I've noticed in some cities crime rates vary significantly by pockets/neighborhood, so it's best to do proper research on top of talking other people. Some cities have government websites and you can use softwares like Vestmap to check neighborhood analysis.

310-848-9776

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Robin SimonBusiness Member
Lender · Austin, TX · Member since 2022 · 5k+ posts · 4k+ votes
2y
What kind of unit count range are you looking at
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Daniel Stoychev
Investor · Sarasota, FL · Member since 2022 · 29 posts · 14 votes
2y
@Braeden Cobb
Lot of good questions here. There are many different ways it can be answered and a lot of advice can be given.
In the beginning I would focus on your surrounding areas 30 minutes to an hour away. If you plan on managing it yourself, you want to be close to monitor any improvements and get familiar and comfortable with the entire process. Be as involved as possible. That will give you the confidence for your next projects afterwards.
Look at 2-4 units, those are a great start. Look into house hacking, BRRR method. Those are great concepts for multifamily investing.
Find out about investment meetups and groups in your local area, and find out if there are any players that bring in partners. It seems you have management experience so that certainly adds value to a partnership.
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Braeden Cobb
OP
Investor · Scottsdale, AZ · Member since 2022 · 50 posts · 22 votes
2y
Quote from @Robin Simon:

What kind of unit count range are you looking at

2-4 units
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Braeden Cobb
OP
Investor · Scottsdale, AZ · Member since 2022 · 50 posts · 22 votes
2y
Quote from @Daniel Stoychev:

@Braeden Cobb
Lot of good questions here. There are many different ways it can be answered and a lot of advice can be given.
In the beginning I would focus on your surrounding areas 30 minutes to an hour away. If you plan on managing it yourself, you want to be close to monitor any improvements and get familiar and comfortable with the entire process. Be as involved as possible. That will give you the confidence for your next projects afterwards.
Look at 2-4 units, those are a great start. Look into house hacking, BRRR method. Those are great concepts for multifamily investing.
Find out about investment meetups and groups in your local area, and find out if there are any players that bring in partners. It seems you have management experience so that certainly adds value to a partnership.
Awesome, thank you for the advice. I would like to house hack, the only problem I have run into is cost of property where I am located/could end up for work (Scottsdale & California).
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Ko KashiwagiPro Member
Lender · Los Angeles, CA · Member since 2022 · 967 posts · 445 votes
2y
Hi Braeden,
What kind of purchase price are you looking at? I've noticed in some cities crime rates vary significantly by pockets/neighborhood, so it's best to do proper research on top of talking other people. Some cities have government websites and you can use softwares like Vestmap to check neighborhood analysis.
310-848-9776
1 Reply
Braeden Cobb
OP
Investor · Scottsdale, AZ · Member since 2022 · 50 posts · 22 votes
2y
Quote from @Ko Kashiwagi:

Hi Braeden,
What kind of purchase price are you looking at? I've noticed in some cities crime rates vary significantly by pockets/neighborhood, so it's best to do proper research on top of talking other people. Some cities have government websites and you can use softwares like Vestmap to check neighborhood analysis.

It really depends on the strategy. If I house hack, budget expands due to financing upsides with an fha or new 5% option with Fannie Mae. If I am investing off-site, I would be looking around 300.
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Wale LawalBusiness Member
Real Estate Broker · Houston | Dallas | Austin, TX · Member since 2018 · 5k+ posts · 2k+ votes
2y
@Braeden Cobb
Even small value-add projects done in real estate specifically referring to multi-family properties can help out significantly in investment returns by boosting them. Increasing value of the property, Enhancing rental income, Giving it a competitive edge Over Other Properties in the neighborhood as well as Adding long term worth among other things are some of the advantages that these projects bring. You therefore have to research well on the market before you consider this kind of investment that requires town location without too high prices but attractive earnings at any given time.

Cities such as Dallas-Forth Worth, Charlotte, Indianapolis, and Atlanta have varied job prospects and available affordable multifamily properties. However, it can be helpful to create an alliance; this requires identification of individual responsibilities together with legal documents and the selection of partners who possess different abilities. Seeking help from realtors, meeting with financiers can be instrumental in handling such investments as these are areas where one would need experts’ advice, lawyers or financial analysts for guidance!

Good luck!
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