I just got out of college and have bought a SFH and it is serving me as a college rental property with an annual ROI of 72%. I am working on other college rentals in the same area as we speak. However, I would like to get in on bigger multifamily deals. Where do I start to look for partners on deals or how should I approach getting into this market?
Without capital or experience, you’re best bet would be to LP with an experienced multifamily operator.
For new investors looking to get started, you have to be able to bring something to the partnership. Best way is relative to your skills. We got started by finding the deal. That took months and months of building relationships with brokers and underwriting billions worth of deals until we found a good one. I’m not exaggerating either. You can spend the time to find deals and make relationships, you can find high net worth people to be able to bring money to someone else’s deal, or like @Reginald Ross said you can put your own money into someone else’s deal.
Where should I begin that search?
@Joseph Humphreys The previous suggestions are excellent. You should search for multifamily meetups and events, either in your area or events that have large CREI attendees. Look for events put on by the names you recognize from online searches or podcasts and find out what you can about the events. But talk to others on BP or other online channels to find out if the events you've found are more sales pitches for the sponsor's coaching or other programs. Many will be fine, but others are just to get people to spend more money on programs of moderate value.
Finding partners is about networking and meeting people to find people who you are compatible with and who need help from less experienced people.
Just jump in!!!
Refi your college rental and buy some multi fam.
@Joseph Humphreys start by buying a list on listsource and sending a direct mail marketing campaign to all the leads. Get familiar with the underwriting and once you get a deal, bring it to a partner with experience. You should also be on every networking event happening in your home town. Maybe you can offer to cold call or door knock for an experienced investor. You need to find a way to add value to an experienced investor. Read books and listen to mtf podcast. It’s all about taking action brother. IM me if you have any questions, happy to help
MFIN conference in Houston February 12th 2022.
Lots of knowledge and lots of great networking with awesome people.
@Joseph Humphreys Depending on the cash flow from your rental and the amount you’re making from your job, assuming you’re working since you’ve just graduated, save up your money and find your own 3-4 unit property and if it’s leased use the leases (and their promised rental income) to help secure your mortgage.
Banks will allow the income from the property if there are leases in place to count towards the amount of income you’re required to have personally to qualify for the mortgage.
This is what I have done on my last two deals. I only use my credit cards monthly and pay them off each cycle. I have no other debt other than mortgages. So as long as the new property covers itself financially and I have the down payment for it I am good to go!
From my perspective it looks like you have several options
1) You could sell your SFH and use that money buy multi fam. Live in one unit and rent the other out.
2) You could do a cash out refi on SFH to use $$ towards new multi family purchase.
3) Find a stellar deal and bring in a partner to fund
4)there is hard money but that isn’t something I would recommend unless you are able to pay it back quickly
I’m sure there are a few other options but these are top of mind for me
@Joseph Humphreys If you haven't already, you can look into some coaching programs. I know several people that have gone through these programs and have found partners with other students and leverage the coach/mentor's experience and even use them as a KP to get deals done and grow their business from there. In fact many of the big programs you hear of today had mentors of their own to start them off. Most coaching programs are quite expensive and are not for everyone. The ones who succeed are the go-getters that take action. Not for people who expect to have everything done for them.