Like most of "louder with crowder" -- this is a very controversial topic.
I'm on team Grant Cardone ... investing in single family or small multifamily should be short-term, value-add flips that create wealth for investment in larger multifamily properties.
@Michael Ealy well than I guess it makes sense for me to start there, and I know it won’t be producing huge profits, BUT, I am planning on living way below my means and just putting the money back into the properties anyway, and it’s not like I have a family to provide for yet, I’m 16 years old haha
@Isaac Johnson Learn Apartment Syndication and you don’t need to “save money” for a deal. Multifamily is definitely the way to go! Good luck (when you’re old enough)!
@Isaac Johnson Learn Apartment Syndication and you don’t need to “save money” for a deal. Multifamily is definitely the way to go! Good luck (when you’re old enough)!
@John Nachtigall sorry for my ignorance, but what is syndication?
no problem. Syndication are how 99% of all commercial real estate is owned. They are just a group of people who come together to invest in what is usually a commercial property. Not just multifamily but office buildings, industrial, retail etc. any commercial building of size is owned by a syndication. They are SEC regulated. Any billionare who "made his money in real estate" was most likely a syndicator.
The general way it works is that the syndicator (general partner) finds a deal. He finds investors (limited partners) to invest. In exchange they get part of the profits. Because they do most of the work the snydicator gets and outsized portion of the profits. General link below
So the advantage is you can own part of a large commercial building without getting involved in any management. For example I own part of a storage facility in Texas, a 5 start resort in Vermont, and an office building in Kansas City. All run by experts in those areas. But it is risky, because is the general partner is wrong or bad....well you probably lose everything.
I hear from a few people that owner occupying a duplex is a good way to start and get familiar with managing property. Turns off some people who like privacy.
@Isaac Johnson Learn Apartment Syndication and you don’t need to “save money” for a deal. Multifamily is definitely the way to go! Good luck (when you’re old enough)!
Yes but you need experience.
Not necessarily. You need education. Then with your education you can find sponsors and investors. But the education is most important. Education makes you a Sophisticated Investor which helps with your first deal...after your first deal is successful, you are able to get more people to invest with you...and sponsor your own deals.
I think that multifamily buy and hold but using the BRRRR method is the best way to go! There are so many potential income streams that way! You have rents and appreciation plus mortgage pay down by tenants. Plus, you get all of the money you invested back if you do it right and can quickly scale!!!
I am hoping to do a BRRRR and SOON!
I bought a duplex FHA style. It does make it slow going that's for sure!
@Angelo Mart I’m glad you do! How did your first deal happen
Since I am a real estate appraiser I have mls access. I saw a great 2-Famiy REO foreclosure on the market. It went under contract within days because I hesitated. I kept checking the market and it came back on market when buyer fell out. I called agent and jumped on it immediately. I used the BRRR strategy
Great post topic! I am not in multi family, but won’t disagree with you. The most important thing is to find a niche and stick to it until you can branch out if you decide to. If it hasn’t already been mentioned follow @Rod Khleif as he’s the expert when it comes to multi family investing! (He’s also an excellent person)
Great comment from John but I have one quibble about accreditation. It's possible to invest in 506(b) deals as an unaccredited investor. The good news is that the vast majority of syndications are 506(b), but the only way you can invest is by having an existing relationship with the syndicator (they are not allowed to advertise their deals). The best way to find syndicators is going to meetups and listening to podcasts, then reaching out to syndicators you meet or hear about.
@Isaac Johnson multifamily is definitely the place to be in, so congratulations with that, grab a copy of “Best Ever Apartment Syndication Book” if you’ll decide to change your mind at some point.
@Isaac Johnson Great post. I have nearly 80% of my entire investment portfolio in multifamily investments. Nice conclusion! The definition of intelligence is: "you agree with me" - Best of luck!