Hey guys, I am in the process of buying my first multi family propery. This is a 3 unit in a great location. CoC return is going to be about 70%, CAP rate is looking like 13%. Pretty excited about this first move in REI!
My goals are to focus on buy and holds for long term returns. I am very interested in the multi family realm and feel this is the best route to take vs my other options in REI. My goal is to reach 100+ units by the age of 30. In this process I currently hold a full-time and part-time job. So I will have a few different income sources to suppliment this goal.
I have heard a lot about the BRRRR strategy and have seen it work for many, but I don't like the debt factor that comes with it. At the same time I totally support letting your money leverage and work hard for you for quickest ROI results.
I am planning to take this route to achieve my goal of 100+ units by the age of 30. My question is what do you guys think would be the best method or strategy to achieve this goal? What has worked for you?
Hi @Andrew Michaud ,
Congrats on your first property, at first read, the numbers you threw out seem sound and you should do well in the long term. Your goals to focus on buy and hold properties seems sound, and getting started at a young age will allow time to be on your side, to take advantage of some gains due to inflation, changing market conditions, historical trends and your experience in the RE market. Wanting to own 100+ units is a lofty goal, and could be a management nightmare if you are not well equipped for it. Taking time to season your experience is the best advise I can offer here, and I say just take one investment at a time, gain success, revise your strategy and continue to build your team (realtor, lender, contractor, appraiser, etc.) to support your long term investing goals.
One of the things I have learned here on BP, is that many investors (including myself) think in terms of goals as a financial windfall, versus a count as to how many pieces of RE they own. For example, one of my new mentors here had a goal of a specific dollar amount to achieve monthly, to create their financial independence. So, if you think that you can achieve financial independence on $5000 dollars per month per se, then that should be your goal. Then work backwards to find smart investments to get you to that goal. You may not need 100 units to do that, perhaps 50 or 25 or even 10, depending upon the cash flow. This assertion is spoken on in many books and blogs of gurus who help people achieve financial independence and early retirement.
I say, start somewhere, be smart, squeeze those numbers through thoughtful analysis of all deals and be patient.
Be sure to take a look at the book "Set for life" by @Scott Trench , and one of my favorites, "The Millionaire Next Door".
Good luck, I hope this was helpful.