First Investment - Thoughts on 10 unit apartment complex

[William Glass]

I've been actively looking for duplexes in the Fort Myers, Lehigh Acres, & Cape Coral area of FL. Price ranges for these properties are in the 130-200k range and I'd have to live in one side in order to secure the financing terms I need for at least a year before moving on, If I go at at alone. Had an accepted offer and during inspection a few things popped up and seller's agent was withholding information and not wanting to put things in writing so I withdrew. Back to the drawing board.

I'm originally from Birmingham, AL and property is much cheaper in AL than FL. I've found 9 & 10 unit apartment complexes that are priced in the 150-200k range. Granted these properties are in low income areas, but understanding i'm buying for cash-flow this seems like it may present a better opportunity. 

If I can qualify a good deal on an apartment complex, I can raise the remaining capital. 

Looking to understand what terms you look for and how you analyze deals. Apartment complexes are all about the numbers which I like more than SFH.

Any advice from anyone who is familiar with smaller apartment complexes in low income areas? 

[Curtis Bidwell]

@William Glass I encourage you to get your $ in line first and then go find a deal.  Few sellers (and fewer agents) will take you seriously if you don't have $ available to close a deal.  

As to a 10 unit, they are not generally found in A neighborhoods.  They are a great entry level commercial with a lot of upside potential if you buy it right.  I would look for a C- property in a B neighborhood that I could improve both in physical facility and tenant composition.  I bought one last December and will get my refi done in the next 2 weeks.  We've done major upgrades and increased rents by 30% (adding over $350k in value).  

You can read about the deal at: https://www.biggerpockets.com/forums/223/topics/26...

I'll be doing an update with actual numbers once the refi is complete.