If you had $10M, how would you invest it?
Investor · Reseda, CA · Member since 2019 · 297 posts · 150 votes
If you had $10M, how would you invest it?
Most Popular Reply
Real Estate Broker · Minneapolis, MN · Member since 2011 · 5k+ posts · 6k+ votes
1yQuote from @Austin Fowler:
Quote from @James Hamling:
Quote from @Austin Fowler:
Quote from @V.G Jason:
Quote from @Austin Fowler:
Quote from @V.G Jason:
Quote from @Gregory Schwartz:
Take $20M, pick up 50 single-family homes at ~$400k each. Rent them at $3k, net about $2k per door. That’s $100k/month in cash flow, plus appreciation. Low-maintenance properties, low-drama tenants, simple portfolio. It’s not flashy, but it’s clean, seats enough to self mange (for the REPS tax benefits), and lets you live well without headaches
$3k at $400k is hard, but possible. Have some higher, some lower, but mainly higher. You'll still have tenant issues, maintenance, etc. To think it'll be all roses is just naive. Fortunately have PMs, AI agents, etc.
With $10 mil continue to be focused on properties in Austin, and Phoenix. Doesn't change for me on the personal portfolio.
$1mil folks worry about protecting their wealth. $10mil folks focus on growing their wealth. But to get to the latter, you usually have to go through the former. Majority of this board shouldn't be focused on this problem though. Think it's just to sniff out potential investors for OPs fund.
Hi V.G., the goal is to encourage actual real estate experts, actual people that operate at this scale, to share techniques that work at this scale and help educate people to head in that direction as well. If you anyone wants to operate at this scale, they need to focus on learning techniques that work at this scale. When it comes to building wealth, you can waste decades of your life learning labor intensive techniques and building a portfolio that simply doesn't scale.
I "operate" with more "scale" than 99% of BP.
And I'm telling you 99% needs to stop being obsessed with scale. And start being obsessed with diligence.
You're getting it right from the horse's mouth, yet still want to push this point. It's missing the forest for the trees. You're trying to scale by acquiring outside capital, I get it. Go do that in a proper form.
Totally agree with a need for everyone to be obsessed with due diligence. For example, when I acquire an asset, it is a month+ long process involving hundreds of people doing group due diligence trying to find holes in the deal and learning more about it before anyone invests. It's an approach anyone can use. I disagree with the philosophy that there are some special people that use special techniques that are amazing and can't even be explained, and then a majority of average people that should stick with average techniques that don't scale. There are good investment techniques that anyone can use that are scalable. One example of such a technique is doing extensive group due diligence on passive multifamily. Another is simply cash or an index fund, neither of which chew up your time and scale arbitrarily. This thread is all about identifying scalable techniques that anyone can use. Or just interesting techniques that people have used at scale. Working together as a community to educate each other.
Scalability is easily and readily available for the vast majority, scalability is not the issue for most.
The issue for most is how limited their investment capitol is, the massive return expectations being sought, over an exceptionally short time-span.
Many seeking parabolic, unrealistic, compounding returns. Which are not really returns, as so many are actually seeking full income replacement via the "investing".
To boot, adding in the riders of things such as "passive", "low risk" and "certain"......
To be fair Austin, you as a syndicator are hacking the scalability via syndication, O.P.M.. Most are not capable, willing or interested in raising O.P.M. to scale and thus a natural limiter of there investible capitol.
Remove your LP capitol, you would not be at the size you are, correct? No syndicator would. So it's not fair to pretend it's the deals that make scalability alone. It is possible but it is very rare, exceptional and non-ordinary for such.
For the vast majority who are measuring their investible capitol in the tens of thousands, while balancing a FT career, a family, life in general, yes it is rare skills and talents to find, analyze and execute on profitable investments at any kind of regularized interval. And in those early steps, the outlay of capitol far outstrips the returns for years or decades limiting any reasonable expectation of scalability.
In my experience the primary focus for most is not on scalability but on certainty to achieve financial freedom. Which is often defined as a passive income about matching to current active income levels.
For most the only scalability that matters is how to get to their ends. I often see a correlation that this is meet for most between 20-40 SFR's.
For many, scaling beyond that is just added work, and no longer "freedom" as was the entire intent from start, financial freedom, not an occupation change.
Hi V.G.,
> Scalability is easily and readily available for the vast majority, scalability is not the issue for most.
When it comes to scalability, I set the bar high. I want to be able to handle a very great deal of capital deployed in a lot of assets while basically on holiday. Using this perspective, to my eyes many people spend a great deal of time working real estate investing techniques that are not scalable. Passive multifamily is the most scalable technique I currently use, and I could use my exact due diligence process to easily handle $100M without changing how I operate. Just bigger checks into the deals I find.
> In my case, The issue for most is how limited their investment capitol is, the massive return expectations being sought, over an exceptionally short time-span.
So how about we focus on discussing how to solve capital limitations in a way that is doable by anyone?
> Many seeking parabolic, unrealistic, compounding returns. Which are not really returns, as so many are actually seeking full income replacement via the "investing".
I don’t work a W-2 anymore. My investing covers all of my expenses and was sufficient to add $2.5M to my net worth over the last 12 months. Full income replacement is definitely achievable.
> To boot, adding in the riders of things such as "passive", "low risk" and "certain"......
> To be fair Austin, you as a syndicator are hacking the scalability via syndication, O.P.M..
I don’t run syndications. I do invest in other people syndications. I have no desire to be a GP on a multifamily syndication with all of the responsibilities and duties that come with it.
> Most are not capable, willing or interested in raising O.P.M. to scale and thus a natural limiter of there investible capitol.
Here I disagree. I think most people just don’t know how to go about it. I have helped hundreds of people learn how to raise capital for their own investing. I have helped quite a number of people start their own SEC registered managed funds. And there is an awful lot you can do with a lot less than this. It’s knowledge that people need.
> Remove your LP capitol, you would not be at the size you are, correct?
Correct.
> No syndicator would. So it's not fair to pretend it's the deals that make scalability alone.
The multifamily deals I focus on are not mine, and from a return point of view are nothing off the charts, the general target is around 20% per annum. And no, it’s not the deal that gets you to huge scale, it is definitely learning how to raise capital. And that is something anyone can learn, and the only way to get to great wealth in a lifetime.
> It is possible but it is very rare, exceptional and non-ordinary for such.
Agreed it is not about the deal, it is about learning how to access capital efficiently. And that is a teachable skill.
> For the vast majority who are measuring their investible capitol in the tens of thousands, while balancing a FT career, a family, life in general, yes it is rare skills and talents to find, analyze and execute on profitable investments at any kind of regularized interval. And in those early steps, the outlay of capitol far outstrips the returns for years or decades limiting any reasonable expectation of scalability.
So you share the load. You don’t try to do all of the deal due diligence yourself. You do it in a group where some (even most) people can even passively ride on the due diligence of others. You don’t try to reinvent the wheel when it comes to learning how to raise capital, you leverage free tools that already exist.
> In my experience the primary focus for most is not on scalability but on certainty to achieve financial freedom. Which is often defined as a passive income about matching to current active income levels.
Financial freedom requires passive investments at scale. Speaking from experience.
> For most the only scalability that matters is how to get to their ends. I often see a correlation that this is meet for most between 20-40 SFR's.
I would argue that self managing so many single-family rentals is a burden. I’m in that range with managed rentals, and I would say that this is definitely not enough for the level of financial freedom I wish to have, even if they were all paid off, which they aren’t.
> For many, scaling beyond that is just added work, and no longer "freedom" as was the entire intent from start, financial freedom, not an occupation change.
Agreed, but to say the same thing a different way, there are more profitable and more passive investments than single-family long-term rentals.
"....I want to be able to handle a very great deal of capital deployed in a lot of assets while basically on holiday.... Passive multifamily is the most scalable...., ....I could use my exact due diligence process to easily handle $100M without changing how I operate....."
To that end, as a person who's worked in this segment, I agree 100%, community level MFH is the simplest most passive means to effectively be invested in real estate at significant $ levels.
But that is the rub, it's a ~$40m+ "pay-to-play" game. That is a level that an exceptional small % of landlords acheive, or even have a desire to ever achieve. I used to work in private equity, I had 9 and even a few 10 figure clients, I know it's attainable, and how rare that ambition of scale is. Just because you possess it, does not mean it's shared by a majority.
"So how about we focus on discussing how to solve capital limitations in a way that is doable by anyone?"
In the sage wisdom of Ratatouille; anyone can cook, but not everyone can be great.
For those who want to, they can, OPM, it's just that simple and really there is no other way around it, it's just the reality of the math of things. Or they need to be hyper active in it to be able to achieve the parabolic returns from strategies that get to infinite returns in rapid order, ie not passive at all.
The issue is not inability, it's desire. I stepped down from the world of private equity on purpose to work with "average" John & Jane Doe's, from wall street too main street, sacrificing profit for passion of purpose. I have seen the stark difference first hand, the vast majority simply do not desire to achieve "yacht $". Their goals are much more humble and focused toward simplicity.
"....I think most people just don’t know how to go about it. I have helped hundreds of people learn how to raise capital for their own investing. ....It’s knowledge that people need."
For some, very true. Although in this day and age, access to information is so available and so simple, there really is no barriers anymore. Via ai one doesn't even need to put much effort into seaking out the info, one can literally talk to the GPT of choice, for free, and get answers, direction, action items, really everything needed. So again, were back to interest not access being the primary issue.
"....no, it’s not the deal that gets you to huge scale, it is definitely learning how to raise capital. And that is something anyone can learn, and the only way to get to great wealth in a lifetime."
Yes, as I said scalability is readily available.... for those who want it, but that's the point, most don't care to scale, they don't, they want a certain passive income as simply, safely, and quickly as possible.
As for scale being the "only way to get to great wealth", I couldn't disagree more. yes, it is a way, but not the only way. Not to mention "great wealth" is a perceptual thing, for one that may be $100m, another it may be $1b, and for another it may be $50k a year.
I find many "main street" investors consider their "wealth" at $10kmnth inflation adjusted passive income, and the vast majority consider $20k mnth passive income "Great wealth". In the market's I play in, that's readily acheive with less than 10 free & clear SFR's. Or 20 moderately leveraged SFR's. Add in 15% - 20% for security buffer, that's a small, simple, easily managed portfolio that provides flexibility (ie options and control) on how one chooses to run their portfolio and life.
Again, massive scale is not of interest for everyone, or even most.
"So you share the load. You don’t try to do all of the deal due diligence yourself. You do it in a group...."
Nobody ever cares about your $, like you do; this is the credo of main-street investors. Not to mention the loss of control, the dependency of not being self-capable. That equals fear for most on main street, not safety or security. This is antigen to the pursuit of financial FREEDOM, freedom is independence.
"Financial freedom requires passive investments at scale."
Again, strongly disagree. I know of a great many who have acheived financial freedom without significant scale. Again, financial freedom is a perceptual thing that is different and personal person to person. The scale to meet that bar will vary person 2 person, and most are rather humble bars to meet.
"I would argue that self managing so many single-family rentals is a burden."
Well, it can be, it depends on the person, there abilaties, and how savy they are to get professionals when and where one is needed to hire their problems away. Those who do that, can find it very very simple. My best average was managing 184 properties in 7hrs a week, measured over a quarter. Me, as in me, personally actively managing them, not my PM's. So it's doable. I spent 8 months building out the systems and structure to get there but point is, 20-40 is very reasonable to manage in a number of simple ways.
"there are more profitable and more passive investments than single-family long-term rentals."
I disagree, and I have the math to back me up. MFH is not nearly as liquid as SFR's. SFR's allow a person choice of liquidation via revenue valuation OR retail O.O. valuation, you don't get that with MFH. Capitol costs are less, inventory is more available, less regulatory impact, more options for monetization, financing is simpler, accessing equity is simpler and more available, operation options are simpler and with greater control.
Reality is for the vast majority who seek Cadillac $ not Lambo $, value simplicity, control, reliability and consistency, SFR's reign supreme, they do.
MFH's is for scale, 100%. But as said, not everyone or even the majority want to scale, they simply don't.
69 Replies
- Rental Property Investor · San Francisco Bay Area · Member since 2022 · 1k+ posts · 1k+ votes1y
Possibly NNN leases out of state, no more dealing with residential tenants and repairs. Maybe multi-units in Nevada.
The allocation probably $2.5 to 3 million in real estate. The other $6 to 7 million in public markets (index funds, some individual stocks, Master Limited Partnerships and Business Development Companies, some REITs, gold) - the same as my answer to $1million question.
Possibly start up a small business and take out an SBA loan so maybe $500k (haven't researched this so I'm just throwing out a random number).
- Investor · Reseda, CA · Member since 2019 · 297 posts · 150 votes1y
Quote from @Becca F.:
Possibly NNN leases out of state, no more dealing with residential tenants and repairs. Maybe multi-units in Nevada.
The allocation probably $2.5 to 3 million in real estate. The other $6 to 7 million in public markets (index funds, some individual stocks, Master Limited Partnerships and Business Development Companies, some REITs, gold) - the same as my answer to $1million question.
Possibly start up a small business and take out an SBA loan so maybe $500k (haven't researched this so I'm just throwing out a random number).
Thanks Becca, have you invested in NNN property before? If not, do you know people that have built NNN portfolios?
- Rental Property Investor · San Francisco Bay Area · Member since 2022 · 1k+ posts · 1k+ votes1y
Quote from @Austin Fowler:
Quote from @Becca F.:
Possibly NNN leases out of state, no more dealing with residential tenants and repairs. Maybe multi-units in Nevada.
The allocation probably $2.5 to 3 million in real estate. The other $6 to 7 million in public markets (index funds, some individual stocks, Master Limited Partnerships and Business Development Companies, some REITs, gold) - the same as my answer to $1million question.
Possibly start up a small business and take out an SBA loan so maybe $500k (haven't researched this so I'm just throwing out a random number).
Thanks Becca, have you invested in NNN property before? If not, do you know people that have built NNN portfolios?
I haven't invested in NNN leases. I know a California investor who's investing in NNN properties in the Midwest and South, specifically commercial spaces for fast food, coffee shops and medical offices. So far he and his wife are doing well.
I forgot to add some portion of the $6 to $7 million liquid in a CD or HYSA as a safety net for market downturns and for the public market piece, some of it in bonds.
- Real Estate Broker · Minneapolis, MN · Member since 2011 · 5k+ posts · 6k+ votes1y
Quote from @Becca F.:
Quote from @Austin Fowler:
Quote from @Becca F.:
Possibly NNN leases out of state, no more dealing with residential tenants and repairs. Maybe multi-units in Nevada.
The allocation probably $2.5 to 3 million in real estate. The other $6 to 7 million in public markets (index funds, some individual stocks, Master Limited Partnerships and Business Development Companies, some REITs, gold) - the same as my answer to $1million question.
Possibly start up a small business and take out an SBA loan so maybe $500k (haven't researched this so I'm just throwing out a random number).
Thanks Becca, have you invested in NNN property before? If not, do you know people that have built NNN portfolios?
I haven't invested in NNN leases. I know a California investor who's investing in NNN properties in the Midwest and South, specifically commercial spaces for fast food, coffee shops and medical offices. So far he and his wife are doing well.
I forgot to add some portion of the $6 to $7 million liquid in a CD or HYSA as a safety net for market downturns and for the public market piece, some of it in bonds.
I get why you'd think these things are safety-net's Becca, but they are not. I'd coin them torniquets, as in they stem the bleeding but sure as heck don't prevent it.
Think, what happens in a recession? Stimulus, right, to keep things going or get things going.
What is stimulus? It's $-printing by the government. Call it liquidity creation, liquidity injection or whatever, all that is fancy talk of $-printing.
$-printing happens directly or indirectly. It can be, as was done in covid, $ literally being printed into existence. Or via our banking system because since USA operates on fractional lending, that means whenever $ is pressed into availability via loan mechanisms, a % is real $ and the majority % is shazamed into existence via loan creations. Fractional lending.
What's $-printing do? INFLATION.
In summary; recession = inflation.
So a CD, at say 5% interest, during a time of 7, 10, 20% inflation means your still loosing money, right.
A real safety net is ASSETS.
For example, gold, GLD. Look up it's chart, look at what happened post '09', or in covid era. Notice GLD went up, a lot.
Now post '08/09' there was a rare and unique factor that brought down property prices on 1 hand BUT what many ignore is how rents went UP in that same time. And in general there was full recovery within about 7yrs, so all one had to do is not sell in the trough and just lease out a property. And after that, the rubber-band effect and properties, as we all know, way way up, just like GLD.
CD's and bonds are a parking lot, not a safety net for $. It's where one put's $ when don't know where else to place it but know they gotta get it out of where it is.
The cycle we are into now, assets, it's all about inflation adjusting assets of intrinsic value and utility. Real estate, gold, and to some degree there is an argument for BTC. I still coin BTC a speculative play but I acknowledge the results it has long as it's popularized utility holds. Key phrase; long as it's popularized utility holds.
- 1yV.G JasonPro MemberInvestor · Member since 2022 · 3k+ posts · 3k+ votes
Quote from @Becca F.:
Quote from @Austin Fowler:
Quote from @Becca F.:
Possibly NNN leases out of state, no more dealing with residential tenants and repairs. Maybe multi-units in Nevada.
The allocation probably $2.5 to 3 million in real estate. The other $6 to 7 million in public markets (index funds, some individual stocks, Master Limited Partnerships and Business Development Companies, some REITs, gold) - the same as my answer to $1million question.
Possibly start up a small business and take out an SBA loan so maybe $500k (haven't researched this so I'm just throwing out a random number).
Thanks Becca, have you invested in NNN property before? If not, do you know people that have built NNN portfolios?
I haven't invested in NNN leases. I know a California investor who's investing in NNN properties in the Midwest and South, specifically commercial spaces for fast food, coffee shops and medical offices. So far he and his wife are doing well.
I forgot to add some portion of the $6 to $7 million liquid in a CD or HYSA as a safety net for market downturns and for the public market piece, some of it in bonds.
60-70% allocation in those would absolutely make your $10 mil operate like $7 mil very quickly and not just time decay but pricing power would evaporate quicker than you can imagine.
I wrote up in this thread, about 5 posts up, you'll get killed going HYSA....and even S&P.
- Tulsa ok · Member since 2025 · 84 posts · 60 votes1y
I would put about 5 million in heavy rehab apartment complex with no debt and hit about 15%+ return and then put 2 million into super safe 4% return CD and 1.25 million into stocks, gold, bitcoin. 750k into a syndication that says they give 20% return. 500k as an angle investor in a new company. 250k into money market savings account and 250k invested in my mental health!!! (AKA wasted on vacations)
- Investor · Reseda, CA · Member since 2019 · 297 posts · 150 votes1y
Quote from @Chris Howell:
I would put about 5 million in heavy rehab apartment complex with no debt and hit about 15%+ return and then put 2 million into super safe 4% return CD and 1.25 million into stocks, gold, bitcoin. 750k into a syndication that says they give 20% return. 500k as an angle investor in a new company. 250k into money market savings account and 250k invested in my mental health!!! (AKA wasted on vacations)
Hi Chris, is heavy apartment rehab an area you have worked in before? Would love to hear about some of your prior experience in this area.
- 1yGregory SchwartzBusiness MemberRental Property Investor · College Station, TX · Member since 2016 · 1k+ posts · 1k+ votes
All on black. Please and thanks. It's in God's hands now.
Schwartz Realty Group5117 Reviews- Investor · Reseda, CA · Member since 2019 · 297 posts · 150 votes1y
Quote from @Gregory Schwartz:
All on black. Please and thanks. It's in God's hands now.
Okay, now you have a slightly less than 50% chance of having $20M assuming you could find a place that would take a single bet at this level. What would you do with $20M?
- 1yGregory SchwartzBusiness MemberRental Property Investor · College Station, TX · Member since 2016 · 1k+ posts · 1k+ votes
Take $20M, pick up 50 single-family homes at ~$400k each. Rent them at $3k, net about $2k per door. That’s $100k/month in cash flow, plus appreciation. Low-maintenance properties, low-drama tenants, simple portfolio. It’s not flashy, but it’s clean, seats enough to self mange (for the REPS tax benefits), and lets you live well without headaches
Schwartz Realty Group5117 Reviews- 1yV.G JasonPro MemberInvestor · Member since 2022 · 3k+ posts · 3k+ votes
Quote from @Gregory Schwartz:
Take $20M, pick up 50 single-family homes at ~$400k each. Rent them at $3k, net about $2k per door. That’s $100k/month in cash flow, plus appreciation. Low-maintenance properties, low-drama tenants, simple portfolio. It’s not flashy, but it’s clean, seats enough to self mange (for the REPS tax benefits), and lets you live well without headaches
$3k at $400k is hard, but possible. Have some higher, some lower, but mainly higher. You'll still have tenant issues, maintenance, etc. To think it'll be all roses is just naive. Fortunately have PMs, AI agents, etc.
With $10 mil continue to be focused on properties in Austin, and Phoenix. Doesn't change for me on the personal portfolio.
$1mil folks worry about protecting their wealth. $10mil folks focus on growing their wealth. But to get to the latter, you usually have to go through the former. Majority of this board shouldn't be focused on this problem though. Think it's just to sniff out potential investors for OPs fund. - Investor · Reseda, CA · Member since 2019 · 297 posts · 150 votes1y
Quote from @V.G Jason:
Quote from @Gregory Schwartz:
Take $20M, pick up 50 single-family homes at ~$400k each. Rent them at $3k, net about $2k per door. That’s $100k/month in cash flow, plus appreciation. Low-maintenance properties, low-drama tenants, simple portfolio. It’s not flashy, but it’s clean, seats enough to self mange (for the REPS tax benefits), and lets you live well without headaches
$3k at $400k is hard, but possible. Have some higher, some lower, but mainly higher. You'll still have tenant issues, maintenance, etc. To think it'll be all roses is just naive. Fortunately have PMs, AI agents, etc.
With $10 mil continue to be focused on properties in Austin, and Phoenix. Doesn't change for me on the personal portfolio.
$1mil folks worry about protecting their wealth. $10mil folks focus on growing their wealth. But to get to the latter, you usually have to go through the former. Majority of this board shouldn't be focused on this problem though. Think it's just to sniff out potential investors for OPs fund.Hi V.G., the goal is to encourage actual real estate experts, actual people that operate at this scale, to share techniques that work at this scale and help educate people to head in that direction as well. If you anyone wants to operate at this scale, they need to focus on learning techniques that work at this scale. When it comes to building wealth, you can waste decades of your life learning labor intensive techniques and building a portfolio that simply doesn't scale.
- Investor · Reseda, CA · Member since 2019 · 297 posts · 150 votes1y
Quote from @Gregory Schwartz:
Take $20M, pick up 50 single-family homes at ~$400k each. Rent them at $3k, net about $2k per door. That’s $100k/month in cash flow, plus appreciation. Low-maintenance properties, low-drama tenants, simple portfolio. It’s not flashy, but it’s clean, seats enough to self mange (for the REPS tax benefits), and lets you live well without headaches
Hi Gregory, I currently own 32 long-term rentals and they are all managed by property managers but even then there are enough annoying tasks that I don't plan to increase the number of long-term rentals. From renewing rental licenses, to renewing insurance, to approving major repairs, to pulling the trigger on evicting someone, long-term rentals, while sometimes these and other tasks are handled hands off, in other cases the properties do demand some of your time even when you have a property manager. In my case, when it comes to investing larger amounts of money, it's all passive multi-family. Higher returns and more hands off if you know how to choose deals well.
- 1yGregory SchwartzBusiness MemberRental Property Investor · College Station, TX · Member since 2016 · 1k+ posts · 1k+ votes
Quote from @Austin Fowler:
Quote from @Gregory Schwartz:
Take $20M, pick up 50 single-family homes at ~$400k each. Rent them at $3k, net about $2k per door. That’s $100k/month in cash flow, plus appreciation. Low-maintenance properties, low-drama tenants, simple portfolio. It’s not flashy, but it’s clean, seats enough to self mange (for the REPS tax benefits), and lets you live well without headaches
Hi Gregory, I currently own 32 long-term rentals and they are all managed by property managers but even then there are enough annoying tasks that I don't plan to increase the number of long-term rentals. From renewing rental licenses, to renewing insurance, to approving major repairs, to pulling the trigger on evicting someone, long-term rentals, while sometimes these and other tasks are handled hands off, in other cases the properties do demand some of your time even when you have a property manager. In my case, when it comes to investing larger amounts of money, it's all passive multi-family. Higher returns and more hands off if you know how to choose deals well.
This is a well-thought-out answer and very much aligns with the goal my wife and I share. We currently own and self-manage 25 rentals, and both of us have experience working under a mentor who owns 500+ units, with 40+ years in the business and a $100M+ self-managed portfolio.
This answer is based on my experience with a $100M portfolio, which I am very familiar with.
We fully understand the headaches, the time commitment, as @V.G Jason 'spointed out—the returns available in our local market of Bryan–College Station.
That’s why I stand by our goal of building a large single-family portfolio, with each property less than 10 years old and in the $400k range. Paid off preferably to lower risk.
Schwartz Realty Group5117 Reviews - 1yV.G JasonPro MemberInvestor · Member since 2022 · 3k+ posts · 3k+ votes
Quote from @Austin Fowler:
Quote from @V.G Jason:
Quote from @Gregory Schwartz:
Take $20M, pick up 50 single-family homes at ~$400k each. Rent them at $3k, net about $2k per door. That’s $100k/month in cash flow, plus appreciation. Low-maintenance properties, low-drama tenants, simple portfolio. It’s not flashy, but it’s clean, seats enough to self mange (for the REPS tax benefits), and lets you live well without headaches
$3k at $400k is hard, but possible. Have some higher, some lower, but mainly higher. You'll still have tenant issues, maintenance, etc. To think it'll be all roses is just naive. Fortunately have PMs, AI agents, etc.
With $10 mil continue to be focused on properties in Austin, and Phoenix. Doesn't change for me on the personal portfolio.
$1mil folks worry about protecting their wealth. $10mil folks focus on growing their wealth. But to get to the latter, you usually have to go through the former. Majority of this board shouldn't be focused on this problem though. Think it's just to sniff out potential investors for OPs fund.Hi V.G., the goal is to encourage actual real estate experts, actual people that operate at this scale, to share techniques that work at this scale and help educate people to head in that direction as well. If you anyone wants to operate at this scale, they need to focus on learning techniques that work at this scale. When it comes to building wealth, you can waste decades of your life learning labor intensive techniques and building a portfolio that simply doesn't scale.
I "operate" with more "scale" than 99% of BP.
And I'm telling you 99% needs to stop being obsessed with scale. And start being obsessed with diligence.You're getting it right from the horse's mouth, yet still want to push this point. It's missing the forest for the trees. You're trying to scale by acquiring outside capital, I get it. Go do that in a proper form.
- Investor · Reseda, CA · Member since 2019 · 297 posts · 150 votes1y
Quote from @V.G Jason:
Quote from @Austin Fowler:
Quote from @V.G Jason:
Quote from @Gregory Schwartz:
Take $20M, pick up 50 single-family homes at ~$400k each. Rent them at $3k, net about $2k per door. That’s $100k/month in cash flow, plus appreciation. Low-maintenance properties, low-drama tenants, simple portfolio. It’s not flashy, but it’s clean, seats enough to self mange (for the REPS tax benefits), and lets you live well without headaches
$3k at $400k is hard, but possible. Have some higher, some lower, but mainly higher. You'll still have tenant issues, maintenance, etc. To think it'll be all roses is just naive. Fortunately have PMs, AI agents, etc.
With $10 mil continue to be focused on properties in Austin, and Phoenix. Doesn't change for me on the personal portfolio.
$1mil folks worry about protecting their wealth. $10mil folks focus on growing their wealth. But to get to the latter, you usually have to go through the former. Majority of this board shouldn't be focused on this problem though. Think it's just to sniff out potential investors for OPs fund.Hi V.G., the goal is to encourage actual real estate experts, actual people that operate at this scale, to share techniques that work at this scale and help educate people to head in that direction as well. If you anyone wants to operate at this scale, they need to focus on learning techniques that work at this scale. When it comes to building wealth, you can waste decades of your life learning labor intensive techniques and building a portfolio that simply doesn't scale.
I "operate" with more "scale" than 99% of BP.
And I'm telling you 99% needs to stop being obsessed with scale. And start being obsessed with diligence.You're getting it right from the horse's mouth, yet still want to push this point. It's missing the forest for the trees. You're trying to scale by acquiring outside capital, I get it. Go do that in a proper form.
Totally agree with a need for everyone to be obsessed with due diligence. For example, when I acquire an asset, it is a month+ long process involving hundreds of people doing group due diligence trying to find holes in the deal and learning more about it before anyone invests. It's an approach anyone can use. I disagree with the philosophy that there are some special people that use special techniques that are amazing and can't even be explained, and then a majority of average people that should stick with average techniques that don't scale. There are good investment techniques that anyone can use that are scalable. One example of such a technique is doing extensive group due diligence on passive multifamily. Another is simply cash or an index fund, neither of which chew up your time and scale arbitrarily. This thread is all about identifying scalable techniques that anyone can use. Or just interesting techniques that people have used at scale. Working together as a community to educate each other.
- Real Estate Broker · Minneapolis, MN · Member since 2011 · 5k+ posts · 6k+ votes1y
Quote from @Austin Fowler:
Quote from @V.G Jason:
Quote from @Austin Fowler:
Quote from @V.G Jason:
Quote from @Gregory Schwartz:
Take $20M, pick up 50 single-family homes at ~$400k each. Rent them at $3k, net about $2k per door. That’s $100k/month in cash flow, plus appreciation. Low-maintenance properties, low-drama tenants, simple portfolio. It’s not flashy, but it’s clean, seats enough to self mange (for the REPS tax benefits), and lets you live well without headaches
$3k at $400k is hard, but possible. Have some higher, some lower, but mainly higher. You'll still have tenant issues, maintenance, etc. To think it'll be all roses is just naive. Fortunately have PMs, AI agents, etc.
With $10 mil continue to be focused on properties in Austin, and Phoenix. Doesn't change for me on the personal portfolio.
$1mil folks worry about protecting their wealth. $10mil folks focus on growing their wealth. But to get to the latter, you usually have to go through the former. Majority of this board shouldn't be focused on this problem though. Think it's just to sniff out potential investors for OPs fund.Hi V.G., the goal is to encourage actual real estate experts, actual people that operate at this scale, to share techniques that work at this scale and help educate people to head in that direction as well. If you anyone wants to operate at this scale, they need to focus on learning techniques that work at this scale. When it comes to building wealth, you can waste decades of your life learning labor intensive techniques and building a portfolio that simply doesn't scale.
I "operate" with more "scale" than 99% of BP.
And I'm telling you 99% needs to stop being obsessed with scale. And start being obsessed with diligence.You're getting it right from the horse's mouth, yet still want to push this point. It's missing the forest for the trees. You're trying to scale by acquiring outside capital, I get it. Go do that in a proper form.
Totally agree with a need for everyone to be obsessed with due diligence. For example, when I acquire an asset, it is a month+ long process involving hundreds of people doing group due diligence trying to find holes in the deal and learning more about it before anyone invests. It's an approach anyone can use. I disagree with the philosophy that there are some special people that use special techniques that are amazing and can't even be explained, and then a majority of average people that should stick with average techniques that don't scale. There are good investment techniques that anyone can use that are scalable. One example of such a technique is doing extensive group due diligence on passive multifamily. Another is simply cash or an index fund, neither of which chew up your time and scale arbitrarily. This thread is all about identifying scalable techniques that anyone can use. Or just interesting techniques that people have used at scale. Working together as a community to educate each other.
Scalability is easily and readily available for the vast majority, scalability is not the issue for most.
The issue for most is how limited their investment capitol is, the massive return expectations being sought, over an exceptionally short time-span.
Many seeking parabolic, unrealistic, compounding returns. Which are not really returns, as so many are actually seeking full income replacement via the "investing".
To boot, adding in the riders of things such as "passive", "low risk" and "certain"......
To be fair Austin, you as a syndicator are hacking the scalability via syndication, O.P.M.. Most are not capable, willing or interested in raising O.P.M. to scale and thus a natural limiter of there investible capitol.
Remove your LP capitol, you would not be at the size you are, correct? No syndicator would. So it's not fair to pretend it's the deals that make scalability alone. It is possible but it is very rare, exceptional and non-ordinary for such.
For the vast majority who are measuring their investible capitol in the tens of thousands, while balancing a FT career, a family, life in general, yes it is rare skills and talents to find, analyze and execute on profitable investments at any kind of regularized interval. And in those early steps, the outlay of capitol far outstrips the returns for years or decades limiting any reasonable expectation of scalability.
In my experience the primary focus for most is not on scalability but on certainty to achieve financial freedom. Which is often defined as a passive income about matching to current active income levels.
For most the only scalability that matters is how to get to their ends. I often see a correlation that this is meet for most between 20-40 SFR's.
For many, scaling beyond that is just added work, and no longer "freedom" as was the entire intent from start, financial freedom, not an occupation change.
- 1yV.G JasonPro MemberInvestor · Member since 2022 · 3k+ posts · 3k+ votes
Quote from @James Hamling:
Quote from @Austin Fowler:
Quote from @V.G Jason:
Quote from @Austin Fowler:
Quote from @V.G Jason:
Quote from @Gregory Schwartz:
Take $20M, pick up 50 single-family homes at ~$400k each. Rent them at $3k, net about $2k per door. That’s $100k/month in cash flow, plus appreciation. Low-maintenance properties, low-drama tenants, simple portfolio. It’s not flashy, but it’s clean, seats enough to self mange (for the REPS tax benefits), and lets you live well without headaches
$3k at $400k is hard, but possible. Have some higher, some lower, but mainly higher. You'll still have tenant issues, maintenance, etc. To think it'll be all roses is just naive. Fortunately have PMs, AI agents, etc.
With $10 mil continue to be focused on properties in Austin, and Phoenix. Doesn't change for me on the personal portfolio.
$1mil folks worry about protecting their wealth. $10mil folks focus on growing their wealth. But to get to the latter, you usually have to go through the former. Majority of this board shouldn't be focused on this problem though. Think it's just to sniff out potential investors for OPs fund.Hi V.G., the goal is to encourage actual real estate experts, actual people that operate at this scale, to share techniques that work at this scale and help educate people to head in that direction as well. If you anyone wants to operate at this scale, they need to focus on learning techniques that work at this scale. When it comes to building wealth, you can waste decades of your life learning labor intensive techniques and building a portfolio that simply doesn't scale.
I "operate" with more "scale" than 99% of BP.
And I'm telling you 99% needs to stop being obsessed with scale. And start being obsessed with diligence.You're getting it right from the horse's mouth, yet still want to push this point. It's missing the forest for the trees. You're trying to scale by acquiring outside capital, I get it. Go do that in a proper form.
Totally agree with a need for everyone to be obsessed with due diligence. For example, when I acquire an asset, it is a month+ long process involving hundreds of people doing group due diligence trying to find holes in the deal and learning more about it before anyone invests. It's an approach anyone can use. I disagree with the philosophy that there are some special people that use special techniques that are amazing and can't even be explained, and then a majority of average people that should stick with average techniques that don't scale. There are good investment techniques that anyone can use that are scalable. One example of such a technique is doing extensive group due diligence on passive multifamily. Another is simply cash or an index fund, neither of which chew up your time and scale arbitrarily. This thread is all about identifying scalable techniques that anyone can use. Or just interesting techniques that people have used at scale. Working together as a community to educate each other.
Scalability is easily and readily available for the vast majority, scalability is not the issue for most.
The issue for most is how limited their investment capitol is, the massive return expectations being sought, over an exceptionally short time-span.
Many seeking parabolic, unrealistic, compounding returns. Which are not really returns, as so many are actually seeking full income replacement via the "investing".
To boot, adding in the riders of things such as "passive", "low risk" and "certain"......
To be fair Austin, you as a syndicator are hacking the scalability via syndication, O.P.M.. Most are not capable, willing or interested in raising O.P.M. to scale and thus a natural limiter of there investible capitol.
Remove your LP capitol, you would not be at the size you are, correct? No syndicator would. So it's not fair to pretend it's the deals that make scalability alone. It is possible but it is very rare, exceptional and non-ordinary for such.
For the vast majority who are measuring their investible capitol in the tens of thousands, while balancing a FT career, a family, life in general, yes it is rare skills and talents to find, analyze and execute on profitable investments at any kind of regularized interval. And in those early steps, the outlay of capitol far outstrips the returns for years or decades limiting any reasonable expectation of scalability.
In my experience the primary focus for most is not on scalability but on certainty to achieve financial freedom. Which is often defined as a passive income about matching to current active income levels.
For most the only scalability that matters is how to get to their ends. I often see a correlation that this is meet for most between 20-40 SFR's.
For many, scaling beyond that is just added work, and no longer "freedom" as was the entire intent from start, financial freedom, not an occupation change.
Pretty much this.
Scale is a function really of capital and then systems. Most don't have either of those.
They're doing this to get an extra source if income, store of value, etc. The pursuit should be based off diligence for a few properties that are great stores of value(scarcity, high demand), provide utility(say a future 2nd home or possibly vacation rental), delegated management(PMs), and immediate value adds(best capital play for RE). As time goes, debt paydowns and notes to mitigate against interest & liquidity.
Most people here would be better than they are sitting with their current portfolios, with their current jobs, and almost any other scenario if they focused on concentration than "scale". The concentration aspects requires the above and to do that you need to do your diligence. I would take 5 excellent houses in Dallas(which I have and then some) than 20 properties in College Station.
- Investor · Reseda, CA · Member since 2019 · 297 posts · 150 votes1y
Quote from @James Hamling:
Quote from @Austin Fowler:
Quote from @V.G Jason:
Quote from @Austin Fowler:
Quote from @V.G Jason:
Quote from @Gregory Schwartz:
Take $20M, pick up 50 single-family homes at ~$400k each. Rent them at $3k, net about $2k per door. That’s $100k/month in cash flow, plus appreciation. Low-maintenance properties, low-drama tenants, simple portfolio. It’s not flashy, but it’s clean, seats enough to self mange (for the REPS tax benefits), and lets you live well without headaches
$3k at $400k is hard, but possible. Have some higher, some lower, but mainly higher. You'll still have tenant issues, maintenance, etc. To think it'll be all roses is just naive. Fortunately have PMs, AI agents, etc.
With $10 mil continue to be focused on properties in Austin, and Phoenix. Doesn't change for me on the personal portfolio.
$1mil folks worry about protecting their wealth. $10mil folks focus on growing their wealth. But to get to the latter, you usually have to go through the former. Majority of this board shouldn't be focused on this problem though. Think it's just to sniff out potential investors for OPs fund.Hi V.G., the goal is to encourage actual real estate experts, actual people that operate at this scale, to share techniques that work at this scale and help educate people to head in that direction as well. If you anyone wants to operate at this scale, they need to focus on learning techniques that work at this scale. When it comes to building wealth, you can waste decades of your life learning labor intensive techniques and building a portfolio that simply doesn't scale.
I "operate" with more "scale" than 99% of BP.
And I'm telling you 99% needs to stop being obsessed with scale. And start being obsessed with diligence.You're getting it right from the horse's mouth, yet still want to push this point. It's missing the forest for the trees. You're trying to scale by acquiring outside capital, I get it. Go do that in a proper form.
Totally agree with a need for everyone to be obsessed with due diligence. For example, when I acquire an asset, it is a month+ long process involving hundreds of people doing group due diligence trying to find holes in the deal and learning more about it before anyone invests. It's an approach anyone can use. I disagree with the philosophy that there are some special people that use special techniques that are amazing and can't even be explained, and then a majority of average people that should stick with average techniques that don't scale. There are good investment techniques that anyone can use that are scalable. One example of such a technique is doing extensive group due diligence on passive multifamily. Another is simply cash or an index fund, neither of which chew up your time and scale arbitrarily. This thread is all about identifying scalable techniques that anyone can use. Or just interesting techniques that people have used at scale. Working together as a community to educate each other.
Scalability is easily and readily available for the vast majority, scalability is not the issue for most.
The issue for most is how limited their investment capitol is, the massive return expectations being sought, over an exceptionally short time-span.
Many seeking parabolic, unrealistic, compounding returns. Which are not really returns, as so many are actually seeking full income replacement via the "investing".
To boot, adding in the riders of things such as "passive", "low risk" and "certain"......
To be fair Austin, you as a syndicator are hacking the scalability via syndication, O.P.M.. Most are not capable, willing or interested in raising O.P.M. to scale and thus a natural limiter of there investible capitol.
Remove your LP capitol, you would not be at the size you are, correct? No syndicator would. So it's not fair to pretend it's the deals that make scalability alone. It is possible but it is very rare, exceptional and non-ordinary for such.
For the vast majority who are measuring their investible capitol in the tens of thousands, while balancing a FT career, a family, life in general, yes it is rare skills and talents to find, analyze and execute on profitable investments at any kind of regularized interval. And in those early steps, the outlay of capitol far outstrips the returns for years or decades limiting any reasonable expectation of scalability.
In my experience the primary focus for most is not on scalability but on certainty to achieve financial freedom. Which is often defined as a passive income about matching to current active income levels.
For most the only scalability that matters is how to get to their ends. I often see a correlation that this is meet for most between 20-40 SFR's.
For many, scaling beyond that is just added work, and no longer "freedom" as was the entire intent from start, financial freedom, not an occupation change.
Hi V.G.,
> Scalability is easily and readily available for the vast majority, scalability is not the issue for most.
When it comes to scalability, I set the bar high. I want to be able to handle a very great deal of capital deployed in a lot of assets while basically on holiday. Using this perspective, to my eyes many people spend a great deal of time working real estate investing techniques that are not scalable. Passive multifamily is the most scalable technique I currently use, and I could use my exact due diligence process to easily handle $100M without changing how I operate. Just bigger checks into the deals I find.
> In my case, The issue for most is how limited their investment capitol is, the massive return expectations being sought, over an exceptionally short time-span.
So how about we focus on discussing how to solve capital limitations in a way that is doable by anyone?
> Many seeking parabolic, unrealistic, compounding returns. Which are not really returns, as so many are actually seeking full income replacement via the "investing".
I don’t work a W-2 anymore. My investing covers all of my expenses and was sufficient to add $2.5M to my net worth over the last 12 months. Full income replacement is definitely achievable.
> To boot, adding in the riders of things such as "passive", "low risk" and "certain"......
> To be fair Austin, you as a syndicator are hacking the scalability via syndication, O.P.M..
I don’t run syndications. I do invest in other people syndications. I have no desire to be a GP on a multifamily syndication with all of the responsibilities and duties that come with it.
> Most are not capable, willing or interested in raising O.P.M. to scale and thus a natural limiter of there investible capitol.
Here I disagree. I think most people just don’t know how to go about it. I have helped hundreds of people learn how to raise capital for their own investing. I have helped quite a number of people start their own SEC registered managed funds. And there is an awful lot you can do with a lot less than this. It’s knowledge that people need.
> Remove your LP capitol, you would not be at the size you are, correct?
Correct.
> No syndicator would. So it's not fair to pretend it's the deals that make scalability alone.
The multifamily deals I focus on are not mine, and from a return point of view are nothing off the charts, the general target is around 20% per annum. And no, it’s not the deal that gets you to huge scale, it is definitely learning how to raise capital. And that is something anyone can learn, and the only way to get to great wealth in a lifetime.
> It is possible but it is very rare, exceptional and non-ordinary for such.
Agreed it is not about the deal, it is about learning how to access capital efficiently. And that is a teachable skill.
> For the vast majority who are measuring their investible capitol in the tens of thousands, while balancing a FT career, a family, life in general, yes it is rare skills and talents to find, analyze and execute on profitable investments at any kind of regularized interval. And in those early steps, the outlay of capitol far outstrips the returns for years or decades limiting any reasonable expectation of scalability.
So you share the load. You don’t try to do all of the deal due diligence yourself. You do it in a group where some (even most) people can even passively ride on the due diligence of others. You don’t try to reinvent the wheel when it comes to learning how to raise capital, you leverage free tools that already exist.
> In my experience the primary focus for most is not on scalability but on certainty to achieve financial freedom. Which is often defined as a passive income about matching to current active income levels.
Financial freedom requires passive investments at scale. Speaking from experience.
> For most the only scalability that matters is how to get to their ends. I often see a correlation that this is meet for most between 20-40 SFR's.
I would argue that self managing so many single-family rentals is a burden. I’m in that range with managed rentals, and I would say that this is definitely not enough for the level of financial freedom I wish to have, even if they were all paid off, which they aren’t.
> For many, scaling beyond that is just added work, and no longer "freedom" as was the entire intent from start, financial freedom, not an occupation change.
Agreed, but to say the same thing a different way, there are more profitable and more passive investments than single-family long-term rentals.
- Flipper/Rehabber · CA · Member since 2023 · 1k+ posts · 1k+ votes1y
Quote from @Austin Fowler:
Quote from @James Hamling:
Quote from @Austin Fowler:
Quote from @V.G Jason:
Quote from @Austin Fowler:
Quote from @V.G Jason:
Quote from @Gregory Schwartz:
Take $20M, pick up 50 single-family homes at ~$400k each. Rent them at $3k, net about $2k per door. That’s $100k/month in cash flow, plus appreciation. Low-maintenance properties, low-drama tenants, simple portfolio. It’s not flashy, but it’s clean, seats enough to self mange (for the REPS tax benefits), and lets you live well without headaches
$3k at $400k is hard, but possible. Have some higher, some lower, but mainly higher. You'll still have tenant issues, maintenance, etc. To think it'll be all roses is just naive. Fortunately have PMs, AI agents, etc.
With $10 mil continue to be focused on properties in Austin, and Phoenix. Doesn't change for me on the personal portfolio.
$1mil folks worry about protecting their wealth. $10mil folks focus on growing their wealth. But to get to the latter, you usually have to go through the former. Majority of this board shouldn't be focused on this problem though. Think it's just to sniff out potential investors for OPs fund.Hi V.G., the goal is to encourage actual real estate experts, actual people that operate at this scale, to share techniques that work at this scale and help educate people to head in that direction as well. If you anyone wants to operate at this scale, they need to focus on learning techniques that work at this scale. When it comes to building wealth, you can waste decades of your life learning labor intensive techniques and building a portfolio that simply doesn't scale.
I "operate" with more "scale" than 99% of BP.
And I'm telling you 99% needs to stop being obsessed with scale. And start being obsessed with diligence.You're getting it right from the horse's mouth, yet still want to push this point. It's missing the forest for the trees. You're trying to scale by acquiring outside capital, I get it. Go do that in a proper form.
Totally agree with a need for everyone to be obsessed with due diligence. For example, when I acquire an asset, it is a month+ long process involving hundreds of people doing group due diligence trying to find holes in the deal and learning more about it before anyone invests. It's an approach anyone can use. I disagree with the philosophy that there are some special people that use special techniques that are amazing and can't even be explained, and then a majority of average people that should stick with average techniques that don't scale. There are good investment techniques that anyone can use that are scalable. One example of such a technique is doing extensive group due diligence on passive multifamily. Another is simply cash or an index fund, neither of which chew up your time and scale arbitrarily. This thread is all about identifying scalable techniques that anyone can use. Or just interesting techniques that people have used at scale. Working together as a community to educate each other.
Scalability is easily and readily available for the vast majority, scalability is not the issue for most.
The issue for most is how limited their investment capitol is, the massive return expectations being sought, over an exceptionally short time-span.
Many seeking parabolic, unrealistic, compounding returns. Which are not really returns, as so many are actually seeking full income replacement via the "investing".
To boot, adding in the riders of things such as "passive", "low risk" and "certain"......
To be fair Austin, you as a syndicator are hacking the scalability via syndication, O.P.M.. Most are not capable, willing or interested in raising O.P.M. to scale and thus a natural limiter of there investible capitol.
Remove your LP capitol, you would not be at the size you are, correct? No syndicator would. So it's not fair to pretend it's the deals that make scalability alone. It is possible but it is very rare, exceptional and non-ordinary for such.
For the vast majority who are measuring their investible capitol in the tens of thousands, while balancing a FT career, a family, life in general, yes it is rare skills and talents to find, analyze and execute on profitable investments at any kind of regularized interval. And in those early steps, the outlay of capitol far outstrips the returns for years or decades limiting any reasonable expectation of scalability.
In my experience the primary focus for most is not on scalability but on certainty to achieve financial freedom. Which is often defined as a passive income about matching to current active income levels.
For most the only scalability that matters is how to get to their ends. I often see a correlation that this is meet for most between 20-40 SFR's.
For many, scaling beyond that is just added work, and no longer "freedom" as was the entire intent from start, financial freedom, not an occupation change.
Hi V.G.,
> Scalability is easily and readily available for the vast majority, scalability is not the issue for most.
When it comes to scalability, I set the bar high. I want to be able to handle a very great deal of capital deployed in a lot of assets while basically on holiday. Using this perspective, to my eyes many people spend a great deal of time working real estate investing techniques that are not scalable. Passive multifamily is the most scalable technique I currently use, and I could use my exact due diligence process to easily handle $100M without changing how I operate. Just bigger checks into the deals I find.
> In my case, The issue for most is how limited their investment capitol is, the massive return expectations being sought, over an exceptionally short time-span.
So how about we focus on discussing how to solve capital limitations in a way that is doable by anyone?
> Many seeking parabolic, unrealistic, compounding returns. Which are not really returns, as so many are actually seeking full income replacement via the "investing".
I don’t work a W-2 anymore. My investing covers all of my expenses and was sufficient to add $2.5M to my net worth over the last 12 months. Full income replacement is definitely achievable.
> To boot, adding in the riders of things such as "passive", "low risk" and "certain"......
> To be fair Austin, you as a syndicator are hacking the scalability via syndication, O.P.M..
I don’t run syndications. I do invest in other people syndications. I have no desire to be a GP on a multifamily syndication with all of the responsibilities and duties that come with it.
> Most are not capable, willing or interested in raising O.P.M. to scale and thus a natural limiter of there investible capitol.
Here I disagree. I think most people just don’t know how to go about it. I have helped hundreds of people learn how to raise capital for their own investing. I have helped quite a number of people start their own SEC registered managed funds. And there is an awful lot you can do with a lot less than this. It’s knowledge that people need.
> Remove your LP capitol, you would not be at the size you are, correct?
Correct.
> No syndicator would. So it's not fair to pretend it's the deals that make scalability alone.
The multifamily deals I focus on are not mine, and from a return point of view are nothing off the charts, the general target is around 20% per annum. And no, it’s not the deal that gets you to huge scale, it is definitely learning how to raise capital. And that is something anyone can learn, and the only way to get to great wealth in a lifetime.
> It is possible but it is very rare, exceptional and non-ordinary for such.
Agreed it is not about the deal, it is about learning how to access capital efficiently. And that is a teachable skill.
> For the vast majority who are measuring their investible capitol in the tens of thousands, while balancing a FT career, a family, life in general, yes it is rare skills and talents to find, analyze and execute on profitable investments at any kind of regularized interval. And in those early steps, the outlay of capitol far outstrips the returns for years or decades limiting any reasonable expectation of scalability.
So you share the load. You don’t try to do all of the deal due diligence yourself. You do it in a group where some (even most) people can even passively ride on the due diligence of others. You don’t try to reinvent the wheel when it comes to learning how to raise capital, you leverage free tools that already exist.
> In my experience the primary focus for most is not on scalability but on certainty to achieve financial freedom. Which is often defined as a passive income about matching to current active income levels.
Financial freedom requires passive investments at scale. Speaking from experience.
> For most the only scalability that matters is how to get to their ends. I often see a correlation that this is meet for most between 20-40 SFR's.
I would argue that self managing so many single-family rentals is a burden. I’m in that range with managed rentals, and I would say that this is definitely not enough for the level of financial freedom I wish to have, even if they were all paid off, which they aren’t.
> For many, scaling beyond that is just added work, and no longer "freedom" as was the entire intent from start, financial freedom, not an occupation change.
Agreed, but to say the same thing a different way, there are more profitable and more passive investments than single-family long-term rentals.
Then share those pearls of wisdom on the teachable skills of how to access capital, here on the forum.
- Investor · Reseda, CA · Member since 2019 · 297 posts · 150 votes1y
Quote from @Alan F.:
Quote from @Austin Fowler:
Quote from @James Hamling:
Quote from @Austin Fowler:
Quote from @V.G Jason:
Quote from @Austin Fowler:
Quote from @V.G Jason:
Quote from @Gregory Schwartz:
Take $20M, pick up 50 single-family homes at ~$400k each. Rent them at $3k, net about $2k per door. That’s $100k/month in cash flow, plus appreciation. Low-maintenance properties, low-drama tenants, simple portfolio. It’s not flashy, but it’s clean, seats enough to self mange (for the REPS tax benefits), and lets you live well without headaches
$3k at $400k is hard, but possible. Have some higher, some lower, but mainly higher. You'll still have tenant issues, maintenance, etc. To think it'll be all roses is just naive. Fortunately have PMs, AI agents, etc.
With $10 mil continue to be focused on properties in Austin, and Phoenix. Doesn't change for me on the personal portfolio.
$1mil folks worry about protecting their wealth. $10mil folks focus on growing their wealth. But to get to the latter, you usually have to go through the former. Majority of this board shouldn't be focused on this problem though. Think it's just to sniff out potential investors for OPs fund.Hi V.G., the goal is to encourage actual real estate experts, actual people that operate at this scale, to share techniques that work at this scale and help educate people to head in that direction as well. If you anyone wants to operate at this scale, they need to focus on learning techniques that work at this scale. When it comes to building wealth, you can waste decades of your life learning labor intensive techniques and building a portfolio that simply doesn't scale.
I "operate" with more "scale" than 99% of BP.
And I'm telling you 99% needs to stop being obsessed with scale. And start being obsessed with diligence.You're getting it right from the horse's mouth, yet still want to push this point. It's missing the forest for the trees. You're trying to scale by acquiring outside capital, I get it. Go do that in a proper form.
Totally agree with a need for everyone to be obsessed with due diligence. For example, when I acquire an asset, it is a month+ long process involving hundreds of people doing group due diligence trying to find holes in the deal and learning more about it before anyone invests. It's an approach anyone can use. I disagree with the philosophy that there are some special people that use special techniques that are amazing and can't even be explained, and then a majority of average people that should stick with average techniques that don't scale. There are good investment techniques that anyone can use that are scalable. One example of such a technique is doing extensive group due diligence on passive multifamily. Another is simply cash or an index fund, neither of which chew up your time and scale arbitrarily. This thread is all about identifying scalable techniques that anyone can use. Or just interesting techniques that people have used at scale. Working together as a community to educate each other.
Scalability is easily and readily available for the vast majority, scalability is not the issue for most.
The issue for most is how limited their investment capitol is, the massive return expectations being sought, over an exceptionally short time-span.
Many seeking parabolic, unrealistic, compounding returns. Which are not really returns, as so many are actually seeking full income replacement via the "investing".
To boot, adding in the riders of things such as "passive", "low risk" and "certain"......
To be fair Austin, you as a syndicator are hacking the scalability via syndication, O.P.M.. Most are not capable, willing or interested in raising O.P.M. to scale and thus a natural limiter of there investible capitol.
Remove your LP capitol, you would not be at the size you are, correct? No syndicator would. So it's not fair to pretend it's the deals that make scalability alone. It is possible but it is very rare, exceptional and non-ordinary for such.
For the vast majority who are measuring their investible capitol in the tens of thousands, while balancing a FT career, a family, life in general, yes it is rare skills and talents to find, analyze and execute on profitable investments at any kind of regularized interval. And in those early steps, the outlay of capitol far outstrips the returns for years or decades limiting any reasonable expectation of scalability.
In my experience the primary focus for most is not on scalability but on certainty to achieve financial freedom. Which is often defined as a passive income about matching to current active income levels.
For most the only scalability that matters is how to get to their ends. I often see a correlation that this is meet for most between 20-40 SFR's.
For many, scaling beyond that is just added work, and no longer "freedom" as was the entire intent from start, financial freedom, not an occupation change.
Hi V.G.,
> Scalability is easily and readily available for the vast majority, scalability is not the issue for most.
When it comes to scalability, I set the bar high. I want to be able to handle a very great deal of capital deployed in a lot of assets while basically on holiday. Using this perspective, to my eyes many people spend a great deal of time working real estate investing techniques that are not scalable. Passive multifamily is the most scalable technique I currently use, and I could use my exact due diligence process to easily handle $100M without changing how I operate. Just bigger checks into the deals I find.
> In my case, The issue for most is how limited their investment capitol is, the massive return expectations being sought, over an exceptionally short time-span.
So how about we focus on discussing how to solve capital limitations in a way that is doable by anyone?
> Many seeking parabolic, unrealistic, compounding returns. Which are not really returns, as so many are actually seeking full income replacement via the "investing".
I don’t work a W-2 anymore. My investing covers all of my expenses and was sufficient to add $2.5M to my net worth over the last 12 months. Full income replacement is definitely achievable.
> To boot, adding in the riders of things such as "passive", "low risk" and "certain"......
> To be fair Austin, you as a syndicator are hacking the scalability via syndication, O.P.M..
I don’t run syndications. I do invest in other people syndications. I have no desire to be a GP on a multifamily syndication with all of the responsibilities and duties that come with it.
> Most are not capable, willing or interested in raising O.P.M. to scale and thus a natural limiter of there investible capitol.
Here I disagree. I think most people just don’t know how to go about it. I have helped hundreds of people learn how to raise capital for their own investing. I have helped quite a number of people start their own SEC registered managed funds. And there is an awful lot you can do with a lot less than this. It’s knowledge that people need.
> Remove your LP capitol, you would not be at the size you are, correct?
Correct.
> No syndicator would. So it's not fair to pretend it's the deals that make scalability alone.
The multifamily deals I focus on are not mine, and from a return point of view are nothing off the charts, the general target is around 20% per annum. And no, it’s not the deal that gets you to huge scale, it is definitely learning how to raise capital. And that is something anyone can learn, and the only way to get to great wealth in a lifetime.
> It is possible but it is very rare, exceptional and non-ordinary for such.
Agreed it is not about the deal, it is about learning how to access capital efficiently. And that is a teachable skill.
> For the vast majority who are measuring their investible capitol in the tens of thousands, while balancing a FT career, a family, life in general, yes it is rare skills and talents to find, analyze and execute on profitable investments at any kind of regularized interval. And in those early steps, the outlay of capitol far outstrips the returns for years or decades limiting any reasonable expectation of scalability.
So you share the load. You don’t try to do all of the deal due diligence yourself. You do it in a group where some (even most) people can even passively ride on the due diligence of others. You don’t try to reinvent the wheel when it comes to learning how to raise capital, you leverage free tools that already exist.
> In my experience the primary focus for most is not on scalability but on certainty to achieve financial freedom. Which is often defined as a passive income about matching to current active income levels.
Financial freedom requires passive investments at scale. Speaking from experience.
> For most the only scalability that matters is how to get to their ends. I often see a correlation that this is meet for most between 20-40 SFR's.
I would argue that self managing so many single-family rentals is a burden. I’m in that range with managed rentals, and I would say that this is definitely not enough for the level of financial freedom I wish to have, even if they were all paid off, which they aren’t.
> For many, scaling beyond that is just added work, and no longer "freedom" as was the entire intent from start, financial freedom, not an occupation change.
Agreed, but to say the same thing a different way, there are more profitable and more passive investments than single-family long-term rentals.
Then share those pearls of wisdom on the teachable skills of how to access capital, here on the forum.
Would love to, but don't know how to do so without upsetting the moderators. A lot of the techniques rely on tools I've built that are shared freely.
- Investor · Reseda, CA · Member since 2019 · 297 posts · 150 votes1y
Quote from @Alan F.:
Quote from @Austin Fowler:
Quote from @James Hamling:
Quote from @Austin Fowler:
Quote from @V.G Jason:
Quote from @Austin Fowler:
Quote from @V.G Jason:
Quote from @Gregory Schwartz:
Take $20M, pick up 50 single-family homes at ~$400k each. Rent them at $3k, net about $2k per door. That’s $100k/month in cash flow, plus appreciation. Low-maintenance properties, low-drama tenants, simple portfolio. It’s not flashy, but it’s clean, seats enough to self mange (for the REPS tax benefits), and lets you live well without headaches
$3k at $400k is hard, but possible. Have some higher, some lower, but mainly higher. You'll still have tenant issues, maintenance, etc. To think it'll be all roses is just naive. Fortunately have PMs, AI agents, etc.
With $10 mil continue to be focused on properties in Austin, and Phoenix. Doesn't change for me on the personal portfolio.
$1mil folks worry about protecting their wealth. $10mil folks focus on growing their wealth. But to get to the latter, you usually have to go through the former. Majority of this board shouldn't be focused on this problem though. Think it's just to sniff out potential investors for OPs fund.Hi V.G., the goal is to encourage actual real estate experts, actual people that operate at this scale, to share techniques that work at this scale and help educate people to head in that direction as well. If you anyone wants to operate at this scale, they need to focus on learning techniques that work at this scale. When it comes to building wealth, you can waste decades of your life learning labor intensive techniques and building a portfolio that simply doesn't scale.
I "operate" with more "scale" than 99% of BP.
And I'm telling you 99% needs to stop being obsessed with scale. And start being obsessed with diligence.You're getting it right from the horse's mouth, yet still want to push this point. It's missing the forest for the trees. You're trying to scale by acquiring outside capital, I get it. Go do that in a proper form.
Totally agree with a need for everyone to be obsessed with due diligence. For example, when I acquire an asset, it is a month+ long process involving hundreds of people doing group due diligence trying to find holes in the deal and learning more about it before anyone invests. It's an approach anyone can use. I disagree with the philosophy that there are some special people that use special techniques that are amazing and can't even be explained, and then a majority of average people that should stick with average techniques that don't scale. There are good investment techniques that anyone can use that are scalable. One example of such a technique is doing extensive group due diligence on passive multifamily. Another is simply cash or an index fund, neither of which chew up your time and scale arbitrarily. This thread is all about identifying scalable techniques that anyone can use. Or just interesting techniques that people have used at scale. Working together as a community to educate each other.
Scalability is easily and readily available for the vast majority, scalability is not the issue for most.
The issue for most is how limited their investment capitol is, the massive return expectations being sought, over an exceptionally short time-span.
Many seeking parabolic, unrealistic, compounding returns. Which are not really returns, as so many are actually seeking full income replacement via the "investing".
To boot, adding in the riders of things such as "passive", "low risk" and "certain"......
To be fair Austin, you as a syndicator are hacking the scalability via syndication, O.P.M.. Most are not capable, willing or interested in raising O.P.M. to scale and thus a natural limiter of there investible capitol.
Remove your LP capitol, you would not be at the size you are, correct? No syndicator would. So it's not fair to pretend it's the deals that make scalability alone. It is possible but it is very rare, exceptional and non-ordinary for such.
For the vast majority who are measuring their investible capitol in the tens of thousands, while balancing a FT career, a family, life in general, yes it is rare skills and talents to find, analyze and execute on profitable investments at any kind of regularized interval. And in those early steps, the outlay of capitol far outstrips the returns for years or decades limiting any reasonable expectation of scalability.
In my experience the primary focus for most is not on scalability but on certainty to achieve financial freedom. Which is often defined as a passive income about matching to current active income levels.
For most the only scalability that matters is how to get to their ends. I often see a correlation that this is meet for most between 20-40 SFR's.
For many, scaling beyond that is just added work, and no longer "freedom" as was the entire intent from start, financial freedom, not an occupation change.
Hi V.G.,
> Scalability is easily and readily available for the vast majority, scalability is not the issue for most.
When it comes to scalability, I set the bar high. I want to be able to handle a very great deal of capital deployed in a lot of assets while basically on holiday. Using this perspective, to my eyes many people spend a great deal of time working real estate investing techniques that are not scalable. Passive multifamily is the most scalable technique I currently use, and I could use my exact due diligence process to easily handle $100M without changing how I operate. Just bigger checks into the deals I find.
> In my case, The issue for most is how limited their investment capitol is, the massive return expectations being sought, over an exceptionally short time-span.
So how about we focus on discussing how to solve capital limitations in a way that is doable by anyone?
> Many seeking parabolic, unrealistic, compounding returns. Which are not really returns, as so many are actually seeking full income replacement via the "investing".
I don’t work a W-2 anymore. My investing covers all of my expenses and was sufficient to add $2.5M to my net worth over the last 12 months. Full income replacement is definitely achievable.
> To boot, adding in the riders of things such as "passive", "low risk" and "certain"......
> To be fair Austin, you as a syndicator are hacking the scalability via syndication, O.P.M..
I don’t run syndications. I do invest in other people syndications. I have no desire to be a GP on a multifamily syndication with all of the responsibilities and duties that come with it.
> Most are not capable, willing or interested in raising O.P.M. to scale and thus a natural limiter of there investible capitol.
Here I disagree. I think most people just don’t know how to go about it. I have helped hundreds of people learn how to raise capital for their own investing. I have helped quite a number of people start their own SEC registered managed funds. And there is an awful lot you can do with a lot less than this. It’s knowledge that people need.
> Remove your LP capitol, you would not be at the size you are, correct?
Correct.
> No syndicator would. So it's not fair to pretend it's the deals that make scalability alone.
The multifamily deals I focus on are not mine, and from a return point of view are nothing off the charts, the general target is around 20% per annum. And no, it’s not the deal that gets you to huge scale, it is definitely learning how to raise capital. And that is something anyone can learn, and the only way to get to great wealth in a lifetime.
> It is possible but it is very rare, exceptional and non-ordinary for such.
Agreed it is not about the deal, it is about learning how to access capital efficiently. And that is a teachable skill.
> For the vast majority who are measuring their investible capitol in the tens of thousands, while balancing a FT career, a family, life in general, yes it is rare skills and talents to find, analyze and execute on profitable investments at any kind of regularized interval. And in those early steps, the outlay of capitol far outstrips the returns for years or decades limiting any reasonable expectation of scalability.
So you share the load. You don’t try to do all of the deal due diligence yourself. You do it in a group where some (even most) people can even passively ride on the due diligence of others. You don’t try to reinvent the wheel when it comes to learning how to raise capital, you leverage free tools that already exist.
> In my experience the primary focus for most is not on scalability but on certainty to achieve financial freedom. Which is often defined as a passive income about matching to current active income levels.
Financial freedom requires passive investments at scale. Speaking from experience.
> For most the only scalability that matters is how to get to their ends. I often see a correlation that this is meet for most between 20-40 SFR's.
I would argue that self managing so many single-family rentals is a burden. I’m in that range with managed rentals, and I would say that this is definitely not enough for the level of financial freedom I wish to have, even if they were all paid off, which they aren’t.
> For many, scaling beyond that is just added work, and no longer "freedom" as was the entire intent from start, financial freedom, not an occupation change.
Agreed, but to say the same thing a different way, there are more profitable and more passive investments than single-family long-term rentals.
Then share those pearls of wisdom on the teachable skills of how to access capital, here on the forum.
Shared in the classifieds. The info can't go here.
- Real Estate Broker · Minneapolis, MN · Member since 2011 · 5k+ posts · 6k+ votes1y
Quote from @Austin Fowler:
Quote from @James Hamling:
Quote from @Austin Fowler:
Quote from @V.G Jason:
Quote from @Austin Fowler:
Quote from @V.G Jason:
Quote from @Gregory Schwartz:
Take $20M, pick up 50 single-family homes at ~$400k each. Rent them at $3k, net about $2k per door. That’s $100k/month in cash flow, plus appreciation. Low-maintenance properties, low-drama tenants, simple portfolio. It’s not flashy, but it’s clean, seats enough to self mange (for the REPS tax benefits), and lets you live well without headaches
$3k at $400k is hard, but possible. Have some higher, some lower, but mainly higher. You'll still have tenant issues, maintenance, etc. To think it'll be all roses is just naive. Fortunately have PMs, AI agents, etc.
With $10 mil continue to be focused on properties in Austin, and Phoenix. Doesn't change for me on the personal portfolio.
$1mil folks worry about protecting their wealth. $10mil folks focus on growing their wealth. But to get to the latter, you usually have to go through the former. Majority of this board shouldn't be focused on this problem though. Think it's just to sniff out potential investors for OPs fund.Hi V.G., the goal is to encourage actual real estate experts, actual people that operate at this scale, to share techniques that work at this scale and help educate people to head in that direction as well. If you anyone wants to operate at this scale, they need to focus on learning techniques that work at this scale. When it comes to building wealth, you can waste decades of your life learning labor intensive techniques and building a portfolio that simply doesn't scale.
I "operate" with more "scale" than 99% of BP.
And I'm telling you 99% needs to stop being obsessed with scale. And start being obsessed with diligence.You're getting it right from the horse's mouth, yet still want to push this point. It's missing the forest for the trees. You're trying to scale by acquiring outside capital, I get it. Go do that in a proper form.
Totally agree with a need for everyone to be obsessed with due diligence. For example, when I acquire an asset, it is a month+ long process involving hundreds of people doing group due diligence trying to find holes in the deal and learning more about it before anyone invests. It's an approach anyone can use. I disagree with the philosophy that there are some special people that use special techniques that are amazing and can't even be explained, and then a majority of average people that should stick with average techniques that don't scale. There are good investment techniques that anyone can use that are scalable. One example of such a technique is doing extensive group due diligence on passive multifamily. Another is simply cash or an index fund, neither of which chew up your time and scale arbitrarily. This thread is all about identifying scalable techniques that anyone can use. Or just interesting techniques that people have used at scale. Working together as a community to educate each other.
Scalability is easily and readily available for the vast majority, scalability is not the issue for most.
The issue for most is how limited their investment capitol is, the massive return expectations being sought, over an exceptionally short time-span.
Many seeking parabolic, unrealistic, compounding returns. Which are not really returns, as so many are actually seeking full income replacement via the "investing".
To boot, adding in the riders of things such as "passive", "low risk" and "certain"......
To be fair Austin, you as a syndicator are hacking the scalability via syndication, O.P.M.. Most are not capable, willing or interested in raising O.P.M. to scale and thus a natural limiter of there investible capitol.
Remove your LP capitol, you would not be at the size you are, correct? No syndicator would. So it's not fair to pretend it's the deals that make scalability alone. It is possible but it is very rare, exceptional and non-ordinary for such.
For the vast majority who are measuring their investible capitol in the tens of thousands, while balancing a FT career, a family, life in general, yes it is rare skills and talents to find, analyze and execute on profitable investments at any kind of regularized interval. And in those early steps, the outlay of capitol far outstrips the returns for years or decades limiting any reasonable expectation of scalability.
In my experience the primary focus for most is not on scalability but on certainty to achieve financial freedom. Which is often defined as a passive income about matching to current active income levels.
For most the only scalability that matters is how to get to their ends. I often see a correlation that this is meet for most between 20-40 SFR's.
For many, scaling beyond that is just added work, and no longer "freedom" as was the entire intent from start, financial freedom, not an occupation change.
Hi V.G.,
> Scalability is easily and readily available for the vast majority, scalability is not the issue for most.
When it comes to scalability, I set the bar high. I want to be able to handle a very great deal of capital deployed in a lot of assets while basically on holiday. Using this perspective, to my eyes many people spend a great deal of time working real estate investing techniques that are not scalable. Passive multifamily is the most scalable technique I currently use, and I could use my exact due diligence process to easily handle $100M without changing how I operate. Just bigger checks into the deals I find.
> In my case, The issue for most is how limited their investment capitol is, the massive return expectations being sought, over an exceptionally short time-span.
So how about we focus on discussing how to solve capital limitations in a way that is doable by anyone?
> Many seeking parabolic, unrealistic, compounding returns. Which are not really returns, as so many are actually seeking full income replacement via the "investing".
I don’t work a W-2 anymore. My investing covers all of my expenses and was sufficient to add $2.5M to my net worth over the last 12 months. Full income replacement is definitely achievable.
> To boot, adding in the riders of things such as "passive", "low risk" and "certain"......
> To be fair Austin, you as a syndicator are hacking the scalability via syndication, O.P.M..
I don’t run syndications. I do invest in other people syndications. I have no desire to be a GP on a multifamily syndication with all of the responsibilities and duties that come with it.
> Most are not capable, willing or interested in raising O.P.M. to scale and thus a natural limiter of there investible capitol.
Here I disagree. I think most people just don’t know how to go about it. I have helped hundreds of people learn how to raise capital for their own investing. I have helped quite a number of people start their own SEC registered managed funds. And there is an awful lot you can do with a lot less than this. It’s knowledge that people need.
> Remove your LP capitol, you would not be at the size you are, correct?
Correct.
> No syndicator would. So it's not fair to pretend it's the deals that make scalability alone.
The multifamily deals I focus on are not mine, and from a return point of view are nothing off the charts, the general target is around 20% per annum. And no, it’s not the deal that gets you to huge scale, it is definitely learning how to raise capital. And that is something anyone can learn, and the only way to get to great wealth in a lifetime.
> It is possible but it is very rare, exceptional and non-ordinary for such.
Agreed it is not about the deal, it is about learning how to access capital efficiently. And that is a teachable skill.
> For the vast majority who are measuring their investible capitol in the tens of thousands, while balancing a FT career, a family, life in general, yes it is rare skills and talents to find, analyze and execute on profitable investments at any kind of regularized interval. And in those early steps, the outlay of capitol far outstrips the returns for years or decades limiting any reasonable expectation of scalability.
So you share the load. You don’t try to do all of the deal due diligence yourself. You do it in a group where some (even most) people can even passively ride on the due diligence of others. You don’t try to reinvent the wheel when it comes to learning how to raise capital, you leverage free tools that already exist.
> In my experience the primary focus for most is not on scalability but on certainty to achieve financial freedom. Which is often defined as a passive income about matching to current active income levels.
Financial freedom requires passive investments at scale. Speaking from experience.
> For most the only scalability that matters is how to get to their ends. I often see a correlation that this is meet for most between 20-40 SFR's.
I would argue that self managing so many single-family rentals is a burden. I’m in that range with managed rentals, and I would say that this is definitely not enough for the level of financial freedom I wish to have, even if they were all paid off, which they aren’t.
> For many, scaling beyond that is just added work, and no longer "freedom" as was the entire intent from start, financial freedom, not an occupation change.
Agreed, but to say the same thing a different way, there are more profitable and more passive investments than single-family long-term rentals.
"....I want to be able to handle a very great deal of capital deployed in a lot of assets while basically on holiday.... Passive multifamily is the most scalable...., ....I could use my exact due diligence process to easily handle $100M without changing how I operate....."
To that end, as a person who's worked in this segment, I agree 100%, community level MFH is the simplest most passive means to effectively be invested in real estate at significant $ levels.
But that is the rub, it's a ~$40m+ "pay-to-play" game. That is a level that an exceptional small % of landlords acheive, or even have a desire to ever achieve. I used to work in private equity, I had 9 and even a few 10 figure clients, I know it's attainable, and how rare that ambition of scale is. Just because you possess it, does not mean it's shared by a majority.
"So how about we focus on discussing how to solve capital limitations in a way that is doable by anyone?"
In the sage wisdom of Ratatouille; anyone can cook, but not everyone can be great.
For those who want to, they can, OPM, it's just that simple and really there is no other way around it, it's just the reality of the math of things. Or they need to be hyper active in it to be able to achieve the parabolic returns from strategies that get to infinite returns in rapid order, ie not passive at all.
The issue is not inability, it's desire. I stepped down from the world of private equity on purpose to work with "average" John & Jane Doe's, from wall street too main street, sacrificing profit for passion of purpose. I have seen the stark difference first hand, the vast majority simply do not desire to achieve "yacht $". Their goals are much more humble and focused toward simplicity.
"....I think most people just don’t know how to go about it. I have helped hundreds of people learn how to raise capital for their own investing. ....It’s knowledge that people need."
For some, very true. Although in this day and age, access to information is so available and so simple, there really is no barriers anymore. Via ai one doesn't even need to put much effort into seaking out the info, one can literally talk to the GPT of choice, for free, and get answers, direction, action items, really everything needed. So again, were back to interest not access being the primary issue.
"....no, it’s not the deal that gets you to huge scale, it is definitely learning how to raise capital. And that is something anyone can learn, and the only way to get to great wealth in a lifetime."
Yes, as I said scalability is readily available.... for those who want it, but that's the point, most don't care to scale, they don't, they want a certain passive income as simply, safely, and quickly as possible.
As for scale being the "only way to get to great wealth", I couldn't disagree more. yes, it is a way, but not the only way. Not to mention "great wealth" is a perceptual thing, for one that may be $100m, another it may be $1b, and for another it may be $50k a year.
I find many "main street" investors consider their "wealth" at $10kmnth inflation adjusted passive income, and the vast majority consider $20k mnth passive income "Great wealth". In the market's I play in, that's readily acheive with less than 10 free & clear SFR's. Or 20 moderately leveraged SFR's. Add in 15% - 20% for security buffer, that's a small, simple, easily managed portfolio that provides flexibility (ie options and control) on how one chooses to run their portfolio and life.
Again, massive scale is not of interest for everyone, or even most.
"So you share the load. You don’t try to do all of the deal due diligence yourself. You do it in a group...."
Nobody ever cares about your $, like you do; this is the credo of main-street investors. Not to mention the loss of control, the dependency of not being self-capable. That equals fear for most on main street, not safety or security. This is antigen to the pursuit of financial FREEDOM, freedom is independence.
"Financial freedom requires passive investments at scale."
Again, strongly disagree. I know of a great many who have acheived financial freedom without significant scale. Again, financial freedom is a perceptual thing that is different and personal person to person. The scale to meet that bar will vary person 2 person, and most are rather humble bars to meet.
"I would argue that self managing so many single-family rentals is a burden."
Well, it can be, it depends on the person, there abilaties, and how savy they are to get professionals when and where one is needed to hire their problems away. Those who do that, can find it very very simple. My best average was managing 184 properties in 7hrs a week, measured over a quarter. Me, as in me, personally actively managing them, not my PM's. So it's doable. I spent 8 months building out the systems and structure to get there but point is, 20-40 is very reasonable to manage in a number of simple ways.
"there are more profitable and more passive investments than single-family long-term rentals."
I disagree, and I have the math to back me up. MFH is not nearly as liquid as SFR's. SFR's allow a person choice of liquidation via revenue valuation OR retail O.O. valuation, you don't get that with MFH. Capitol costs are less, inventory is more available, less regulatory impact, more options for monetization, financing is simpler, accessing equity is simpler and more available, operation options are simpler and with greater control.
Reality is for the vast majority who seek Cadillac $ not Lambo $, value simplicity, control, reliability and consistency, SFR's reign supreme, they do.
MFH's is for scale, 100%. But as said, not everyone or even the majority want to scale, they simply don't.
- Flipper/Rehabber · CA · Member since 2023 · 1k+ posts · 1k+ votes1yOnce again, James unpacked the crux of the biscuit succinctly. Personally I'd like to go above Cadillac $, that being said "its easier said than done".
Quote from @James Hamling:
Quote from @Austin Fowler:
Quote from @James Hamling:
Quote from @Austin Fowler:
Quote from @V.G Jason:
Quote from @Austin Fowler:
Quote from @V.G Jason:
Quote from @Gregory Schwartz:
Take $20M, pick up 50 single-family homes at ~$400k each. Rent them at $3k, net about $2k per door. That’s $100k/month in cash flow, plus appreciation. Low-maintenance properties, low-drama tenants, simple portfolio. It’s not flashy, but it’s clean, seats enough to self mange (for the REPS tax benefits), and lets you live well without headaches
$3k at $400k is hard, but possible. Have some higher, some lower, but mainly higher. You'll still have tenant issues, maintenance, etc. To think it'll be all roses is just naive. Fortunately have PMs, AI agents, etc.
With $10 mil continue to be focused on properties in Austin, and Phoenix. Doesn't change for me on the personal portfolio.
$1mil folks worry about protecting their wealth. $10mil folks focus on growing their wealth. But to get to the latter, you usually have to go through the former. Majority of this board shouldn't be focused on this problem though. Think it's just to sniff out potential investors for OPs fund.Hi V.G., the goal is to encourage actual real estate experts, actual people that operate at this scale, to share techniques that work at this scale and help educate people to head in that direction as well. If you anyone wants to operate at this scale, they need to focus on learning techniques that work at this scale. When it comes to building wealth, you can waste decades of your life learning labor intensive techniques and building a portfolio that simply doesn't scale.
I "operate" with more "scale" than 99% of BP.
And I'm telling you 99% needs to stop being obsessed with scale. And start being obsessed with diligence.You're getting it right from the horse's mouth, yet still want to push this point. It's missing the forest for the trees. You're trying to scale by acquiring outside capital, I get it. Go do that in a proper form.
Totally agree with a need for everyone to be obsessed with due diligence. For example, when I acquire an asset, it is a month+ long process involving hundreds of people doing group due diligence trying to find holes in the deal and learning more about it before anyone invests. It's an approach anyone can use. I disagree with the philosophy that there are some special people that use special techniques that are amazing and can't even be explained, and then a majority of average people that should stick with average techniques that don't scale. There are good investment techniques that anyone can use that are scalable. One example of such a technique is doing extensive group due diligence on passive multifamily. Another is simply cash or an index fund, neither of which chew up your time and scale arbitrarily. This thread is all about identifying scalable techniques that anyone can use. Or just interesting techniques that people have used at scale. Working together as a community to educate each other.
Scalability is easily and readily available for the vast majority, scalability is not the issue for most.
The issue for most is how limited their investment capitol is, the massive return expectations being sought, over an exceptionally short time-span.
Many seeking parabolic, unrealistic, compounding returns. Which are not really returns, as so many are actually seeking full income replacement via the "investing".
To boot, adding in the riders of things such as "passive", "low risk" and "certain"......
To be fair Austin, you as a syndicator are hacking the scalability via syndication, O.P.M.. Most are not capable, willing or interested in raising O.P.M. to scale and thus a natural limiter of there investible capitol.
Remove your LP capitol, you would not be at the size you are, correct? No syndicator would. So it's not fair to pretend it's the deals that make scalability alone. It is possible but it is very rare, exceptional and non-ordinary for such.
For the vast majority who are measuring their investible capitol in the tens of thousands, while balancing a FT career, a family, life in general, yes it is rare skills and talents to find, analyze and execute on profitable investments at any kind of regularized interval. And in those early steps, the outlay of capitol far outstrips the returns for years or decades limiting any reasonable expectation of scalability.
In my experience the primary focus for most is not on scalability but on certainty to achieve financial freedom. Which is often defined as a passive income about matching to current active income levels.
For most the only scalability that matters is how to get to their ends. I often see a correlation that this is meet for most between 20-40 SFR's.
For many, scaling beyond that is just added work, and no longer "freedom" as was the entire intent from start, financial freedom, not an occupation change.
Hi V.G.,
> Scalability is easily and readily available for the vast majority, scalability is not the issue for most.
When it comes to scalability, I set the bar high. I want to be able to handle a very great deal of capital deployed in a lot of assets while basically on holiday. Using this perspective, to my eyes many people spend a great deal of time working real estate investing techniques that are not scalable. Passive multifamily is the most scalable technique I currently use, and I could use my exact due diligence process to easily handle $100M without changing how I operate. Just bigger checks into the deals I find.
> In my case, The issue for most is how limited their investment capitol is, the massive return expectations being sought, over an exceptionally short time-span.
So how about we focus on discussing how to solve capital limitations in a way that is doable by anyone?
> Many seeking parabolic, unrealistic, compounding returns. Which are not really returns, as so many are actually seeking full income replacement via the "investing".
I don’t work a W-2 anymore. My investing covers all of my expenses and was sufficient to add $2.5M to my net worth over the last 12 months. Full income replacement is definitely achievable.
> To boot, adding in the riders of things such as "passive", "low risk" and "certain"......
> To be fair Austin, you as a syndicator are hacking the scalability via syndication, O.P.M..
I don’t run syndications. I do invest in other people syndications. I have no desire to be a GP on a multifamily syndication with all of the responsibilities and duties that come with it.
> Most are not capable, willing or interested in raising O.P.M. to scale and thus a natural limiter of there investible capitol.
Here I disagree. I think most people just don’t know how to go about it. I have helped hundreds of people learn how to raise capital for their own investing. I have helped quite a number of people start their own SEC registered managed funds. And there is an awful lot you can do with a lot less than this. It’s knowledge that people need.
> Remove your LP capitol, you would not be at the size you are, correct?
Correct.
> No syndicator would. So it's not fair to pretend it's the deals that make scalability alone.
The multifamily deals I focus on are not mine, and from a return point of view are nothing off the charts, the general target is around 20% per annum. And no, it’s not the deal that gets you to huge scale, it is definitely learning how to raise capital. And that is something anyone can learn, and the only way to get to great wealth in a lifetime.
> It is possible but it is very rare, exceptional and non-ordinary for such.
Agreed it is not about the deal, it is about learning how to access capital efficiently. And that is a teachable skill.
> For the vast majority who are measuring their investible capitol in the tens of thousands, while balancing a FT career, a family, life in general, yes it is rare skills and talents to find, analyze and execute on profitable investments at any kind of regularized interval. And in those early steps, the outlay of capitol far outstrips the returns for years or decades limiting any reasonable expectation of scalability.
So you share the load. You don’t try to do all of the deal due diligence yourself. You do it in a group where some (even most) people can even passively ride on the due diligence of others. You don’t try to reinvent the wheel when it comes to learning how to raise capital, you leverage free tools that already exist.
> In my experience the primary focus for most is not on scalability but on certainty to achieve financial freedom. Which is often defined as a passive income about matching to current active income levels.
Financial freedom requires passive investments at scale. Speaking from experience.
> For most the only scalability that matters is how to get to their ends. I often see a correlation that this is meet for most between 20-40 SFR's.
I would argue that self managing so many single-family rentals is a burden. I’m in that range with managed rentals, and I would say that this is definitely not enough for the level of financial freedom I wish to have, even if they were all paid off, which they aren’t.
> For many, scaling beyond that is just added work, and no longer "freedom" as was the entire intent from start, financial freedom, not an occupation change.
Agreed, but to say the same thing a different way, there are more profitable and more passive investments than single-family long-term rentals.
"....I want to be able to handle a very great deal of capital deployed in a lot of assets while basically on holiday.... Passive multifamily is the most scalable...., ....I could use my exact due diligence process to easily handle $100M without changing how I operate....."
To that end, as a person who's worked in this segment, I agree 100%, community level MFH is the simplest most passive means to effectively be invested in real estate at significant $ levels.
But that is the rub, it's a ~$40m+ "pay-to-play" game. That is a level that an exceptional small % of landlords acheive, or even have a desire to ever achieve. I used to work in private equity, I had 9 and even a few 10 figure clients, I know it's attainable, and how rare that ambition of scale is. Just because you possess it, does not mean it's shared by a majority.
"So how about we focus on discussing how to solve capital limitations in a way that is doable by anyone?"
In the sage wisdom of Ratatouille; anyone can cook, but not everyone can be great.
For those who want to, they can, OPM, it's just that simple and really there is no other way around it, it's just the reality of the math of things. Or they need to be hyper active in it to be able to achieve the parabolic returns from strategies that get to infinite returns in rapid order, ie not passive at all.
The issue is not inability, it's desire. I stepped down from the world of private equity on purpose to work with "average" John & Jane Doe's, from wall street too main street, sacrificing profit for passion of purpose. I have seen the stark difference first hand, the vast majority simply do not desire to achieve "yacht $". Their goals are much more humble and focused toward simplicity.
"....I think most people just don’t know how to go about it. I have helped hundreds of people learn how to raise capital for their own investing. ....It’s knowledge that people need."
For some, very true. Although in this day and age, access to information is so available and so simple, there really is no barriers anymore. Via ai one doesn't even need to put much effort into seaking out the info, one can literally talk to the GPT of choice, for free, and get answers, direction, action items, really everything needed. So again, were back to interest not access being the primary issue.
"....no, it’s not the deal that gets you to huge scale, it is definitely learning how to raise capital. And that is something anyone can learn, and the only way to get to great wealth in a lifetime."
Yes, as I said scalability is readily available.... for those who want it, but that's the point, most don't care to scale, they don't, they want a certain passive income as simply, safely, and quickly as possible.
As for scale being the "only way to get to great wealth", I couldn't disagree more. yes, it is a way, but not the only way. Not to mention "great wealth" is a perceptual thing, for one that may be $100m, another it may be $1b, and for another it may be $50k a year.
I find many "main street" investors consider their "wealth" at $10kmnth inflation adjusted passive income, and the vast majority consider $20k mnth passive income "Great wealth". In the market's I play in, that's readily acheive with less than 10 free & clear SFR's. Or 20 moderately leveraged SFR's. Add in 15% - 20% for security buffer, that's a small, simple, easily managed portfolio that provides flexibility (ie options and control) on how one chooses to run their portfolio and life.
Again, massive scale is not of interest for everyone, or even most.
"So you share the load. You don’t try to do all of the deal due diligence yourself. You do it in a group...."
Nobody ever cares about your $, like you do; this is the credo of main-street investors. Not to mention the loss of control, the dependency of not being self-capable. That equals fear for most on main street, not safety or security. This is antigen to the pursuit of financial FREEDOM, freedom is independence.
"Financial freedom requires passive investments at scale."
Again, strongly disagree. I know of a great many who have acheived financial freedom without significant scale. Again, financial freedom is a perceptual thing that is different and personal person to person. The scale to meet that bar will vary person 2 person, and most are rather humble bars to meet.
"I would argue that self managing so many single-family rentals is a burden."
Well, it can be, it depends on the person, there abilaties, and how savy they are to get professionals when and where one is needed to hire their problems away. Those who do that, can find it very very simple. My best average was managing 184 properties in 7hrs a week, measured over a quarter. Me, as in me, personally actively managing them, not my PM's. So it's doable. I spent 8 months building out the systems and structure to get there but point is, 20-40 is very reasonable to manage in a number of simple ways.
"there are more profitable and more passive investments than single-family long-term rentals."
I disagree, and I have the math to back me up. MFH is not nearly as liquid as SFR's. SFR's allow a person choice of liquidation via revenue valuation OR retail O.O. valuation, you don't get that with MFH. Capitol costs are less, inventory is more available, less regulatory impact, more options for monetization, financing is simpler, accessing equity is simpler and more available, operation options are simpler and with greater control.
Reality is for the vast majority who seek Cadillac $ not Lambo $, value simplicity, control, reliability and consistency, SFR's reign supreme, they do.
MFH's is for scale, 100%. But as said, not everyone or even the majority want to scale, they simply don't.
As someone who's (legitimately) employed dozens of people, written SOPS's, payroll taxes et al, while investing on the side the most valuable lessons I've learned is human nature.
I recall a quote by VG Jason, once you've hit basic accreditation...wealth preservation becomes a high priority (paraphrased)
I've learned, the hard way, as James noted, that no one cares about my $ like I do. Networking is much harder than people portray on this forum, as such I see a few ways of interacting with people; W2 employees were I follow all CA laws, genuine relationships with trusted friends in a belly to belly fashion & contractual/transactual relationships that are enforceable.
An older guy once told me "trust is earned, not given"
The appealing aspect of REI, to me, is that its a tangible/touchable asset where I can affect a difference. Passivity within this industry is is very concerning to me. - Investor · Reseda, CA · Member since 2019 · 297 posts · 150 votes1y
Quote from @James Hamling:
Quote from @Austin Fowler:
Quote from @James Hamling:
Quote from @Austin Fowler:
Quote from @V.G Jason:
Quote from @Austin Fowler:
Quote from @V.G Jason:
Quote from @Gregory Schwartz:
Take $20M, pick up 50 single-family homes at ~$400k each. Rent them at $3k, net about $2k per door. That’s $100k/month in cash flow, plus appreciation. Low-maintenance properties, low-drama tenants, simple portfolio. It’s not flashy, but it’s clean, seats enough to self mange (for the REPS tax benefits), and lets you live well without headaches
$3k at $400k is hard, but possible. Have some higher, some lower, but mainly higher. You'll still have tenant issues, maintenance, etc. To think it'll be all roses is just naive. Fortunately have PMs, AI agents, etc.
With $10 mil continue to be focused on properties in Austin, and Phoenix. Doesn't change for me on the personal portfolio.
$1mil folks worry about protecting their wealth. $10mil folks focus on growing their wealth. But to get to the latter, you usually have to go through the former. Majority of this board shouldn't be focused on this problem though. Think it's just to sniff out potential investors for OPs fund.Hi V.G., the goal is to encourage actual real estate experts, actual people that operate at this scale, to share techniques that work at this scale and help educate people to head in that direction as well. If you anyone wants to operate at this scale, they need to focus on learning techniques that work at this scale. When it comes to building wealth, you can waste decades of your life learning labor intensive techniques and building a portfolio that simply doesn't scale.
I "operate" with more "scale" than 99% of BP.
And I'm telling you 99% needs to stop being obsessed with scale. And start being obsessed with diligence.You're getting it right from the horse's mouth, yet still want to push this point. It's missing the forest for the trees. You're trying to scale by acquiring outside capital, I get it. Go do that in a proper form.
Totally agree with a need for everyone to be obsessed with due diligence. For example, when I acquire an asset, it is a month+ long process involving hundreds of people doing group due diligence trying to find holes in the deal and learning more about it before anyone invests. It's an approach anyone can use. I disagree with the philosophy that there are some special people that use special techniques that are amazing and can't even be explained, and then a majority of average people that should stick with average techniques that don't scale. There are good investment techniques that anyone can use that are scalable. One example of such a technique is doing extensive group due diligence on passive multifamily. Another is simply cash or an index fund, neither of which chew up your time and scale arbitrarily. This thread is all about identifying scalable techniques that anyone can use. Or just interesting techniques that people have used at scale. Working together as a community to educate each other.
Scalability is easily and readily available for the vast majority, scalability is not the issue for most.
The issue for most is how limited their investment capitol is, the massive return expectations being sought, over an exceptionally short time-span.
Many seeking parabolic, unrealistic, compounding returns. Which are not really returns, as so many are actually seeking full income replacement via the "investing".
To boot, adding in the riders of things such as "passive", "low risk" and "certain"......
To be fair Austin, you as a syndicator are hacking the scalability via syndication, O.P.M.. Most are not capable, willing or interested in raising O.P.M. to scale and thus a natural limiter of there investible capitol.
Remove your LP capitol, you would not be at the size you are, correct? No syndicator would. So it's not fair to pretend it's the deals that make scalability alone. It is possible but it is very rare, exceptional and non-ordinary for such.
For the vast majority who are measuring their investible capitol in the tens of thousands, while balancing a FT career, a family, life in general, yes it is rare skills and talents to find, analyze and execute on profitable investments at any kind of regularized interval. And in those early steps, the outlay of capitol far outstrips the returns for years or decades limiting any reasonable expectation of scalability.
In my experience the primary focus for most is not on scalability but on certainty to achieve financial freedom. Which is often defined as a passive income about matching to current active income levels.
For most the only scalability that matters is how to get to their ends. I often see a correlation that this is meet for most between 20-40 SFR's.
For many, scaling beyond that is just added work, and no longer "freedom" as was the entire intent from start, financial freedom, not an occupation change.
Hi V.G.,
> Scalability is easily and readily available for the vast majority, scalability is not the issue for most.
When it comes to scalability, I set the bar high. I want to be able to handle a very great deal of capital deployed in a lot of assets while basically on holiday. Using this perspective, to my eyes many people spend a great deal of time working real estate investing techniques that are not scalable. Passive multifamily is the most scalable technique I currently use, and I could use my exact due diligence process to easily handle $100M without changing how I operate. Just bigger checks into the deals I find.
> In my case, The issue for most is how limited their investment capitol is, the massive return expectations being sought, over an exceptionally short time-span.
So how about we focus on discussing how to solve capital limitations in a way that is doable by anyone?
> Many seeking parabolic, unrealistic, compounding returns. Which are not really returns, as so many are actually seeking full income replacement via the "investing".
I don’t work a W-2 anymore. My investing covers all of my expenses and was sufficient to add $2.5M to my net worth over the last 12 months. Full income replacement is definitely achievable.
> To boot, adding in the riders of things such as "passive", "low risk" and "certain"......
> To be fair Austin, you as a syndicator are hacking the scalability via syndication, O.P.M..
I don’t run syndications. I do invest in other people syndications. I have no desire to be a GP on a multifamily syndication with all of the responsibilities and duties that come with it.
> Most are not capable, willing or interested in raising O.P.M. to scale and thus a natural limiter of there investible capitol.
Here I disagree. I think most people just don’t know how to go about it. I have helped hundreds of people learn how to raise capital for their own investing. I have helped quite a number of people start their own SEC registered managed funds. And there is an awful lot you can do with a lot less than this. It’s knowledge that people need.
> Remove your LP capitol, you would not be at the size you are, correct?
Correct.
> No syndicator would. So it's not fair to pretend it's the deals that make scalability alone.
The multifamily deals I focus on are not mine, and from a return point of view are nothing off the charts, the general target is around 20% per annum. And no, it’s not the deal that gets you to huge scale, it is definitely learning how to raise capital. And that is something anyone can learn, and the only way to get to great wealth in a lifetime.
> It is possible but it is very rare, exceptional and non-ordinary for such.
Agreed it is not about the deal, it is about learning how to access capital efficiently. And that is a teachable skill.
> For the vast majority who are measuring their investible capitol in the tens of thousands, while balancing a FT career, a family, life in general, yes it is rare skills and talents to find, analyze and execute on profitable investments at any kind of regularized interval. And in those early steps, the outlay of capitol far outstrips the returns for years or decades limiting any reasonable expectation of scalability.
So you share the load. You don’t try to do all of the deal due diligence yourself. You do it in a group where some (even most) people can even passively ride on the due diligence of others. You don’t try to reinvent the wheel when it comes to learning how to raise capital, you leverage free tools that already exist.
> In my experience the primary focus for most is not on scalability but on certainty to achieve financial freedom. Which is often defined as a passive income about matching to current active income levels.
Financial freedom requires passive investments at scale. Speaking from experience.
> For most the only scalability that matters is how to get to their ends. I often see a correlation that this is meet for most between 20-40 SFR's.
I would argue that self managing so many single-family rentals is a burden. I’m in that range with managed rentals, and I would say that this is definitely not enough for the level of financial freedom I wish to have, even if they were all paid off, which they aren’t.
> For many, scaling beyond that is just added work, and no longer "freedom" as was the entire intent from start, financial freedom, not an occupation change.
Agreed, but to say the same thing a different way, there are more profitable and more passive investments than single-family long-term rentals.
"....I want to be able to handle a very great deal of capital deployed in a lot of assets while basically on holiday.... Passive multifamily is the most scalable...., ....I could use my exact due diligence process to easily handle $100M without changing how I operate....."
To that end, as a person who's worked in this segment, I agree 100%, community level MFH is the simplest most passive means to effectively be invested in real estate at significant $ levels.
But that is the rub, it's a ~$40m+ "pay-to-play" game. That is a level that an exceptional small % of landlords acheive, or even have a desire to ever achieve. I used to work in private equity, I had 9 and even a few 10 figure clients, I know it's attainable, and how rare that ambition of scale is. Just because you possess it, does not mean it's shared by a majority.
"So how about we focus on discussing how to solve capital limitations in a way that is doable by anyone?"
In the sage wisdom of Ratatouille; anyone can cook, but not everyone can be great.
For those who want to, they can, OPM, it's just that simple and really there is no other way around it, it's just the reality of the math of things. Or they need to be hyper active in it to be able to achieve the parabolic returns from strategies that get to infinite returns in rapid order, ie not passive at all.
The issue is not inability, it's desire. I stepped down from the world of private equity on purpose to work with "average" John & Jane Doe's, from wall street too main street, sacrificing profit for passion of purpose. I have seen the stark difference first hand, the vast majority simply do not desire to achieve "yacht $". Their goals are much more humble and focused toward simplicity.
"....I think most people just don’t know how to go about it. I have helped hundreds of people learn how to raise capital for their own investing. ....It’s knowledge that people need."
For some, very true. Although in this day and age, access to information is so available and so simple, there really is no barriers anymore. Via ai one doesn't even need to put much effort into seaking out the info, one can literally talk to the GPT of choice, for free, and get answers, direction, action items, really everything needed. So again, were back to interest not access being the primary issue.
"....no, it’s not the deal that gets you to huge scale, it is definitely learning how to raise capital. And that is something anyone can learn, and the only way to get to great wealth in a lifetime."
Yes, as I said scalability is readily available.... for those who want it, but that's the point, most don't care to scale, they don't, they want a certain passive income as simply, safely, and quickly as possible.
As for scale being the "only way to get to great wealth", I couldn't disagree more. yes, it is a way, but not the only way. Not to mention "great wealth" is a perceptual thing, for one that may be $100m, another it may be $1b, and for another it may be $50k a year.
I find many "main street" investors consider their "wealth" at $10kmnth inflation adjusted passive income, and the vast majority consider $20k mnth passive income "Great wealth". In the market's I play in, that's readily acheive with less than 10 free & clear SFR's. Or 20 moderately leveraged SFR's. Add in 15% - 20% for security buffer, that's a small, simple, easily managed portfolio that provides flexibility (ie options and control) on how one chooses to run their portfolio and life.
Again, massive scale is not of interest for everyone, or even most.
"So you share the load. You don’t try to do all of the deal due diligence yourself. You do it in a group...."
Nobody ever cares about your $, like you do; this is the credo of main-street investors. Not to mention the loss of control, the dependency of not being self-capable. That equals fear for most on main street, not safety or security. This is antigen to the pursuit of financial FREEDOM, freedom is independence.
"Financial freedom requires passive investments at scale."
Again, strongly disagree. I know of a great many who have acheived financial freedom without significant scale. Again, financial freedom is a perceptual thing that is different and personal person to person. The scale to meet that bar will vary person 2 person, and most are rather humble bars to meet.
"I would argue that self managing so many single-family rentals is a burden."
Well, it can be, it depends on the person, there abilaties, and how savy they are to get professionals when and where one is needed to hire their problems away. Those who do that, can find it very very simple. My best average was managing 184 properties in 7hrs a week, measured over a quarter. Me, as in me, personally actively managing them, not my PM's. So it's doable. I spent 8 months building out the systems and structure to get there but point is, 20-40 is very reasonable to manage in a number of simple ways.
"there are more profitable and more passive investments than single-family long-term rentals."
I disagree, and I have the math to back me up. MFH is not nearly as liquid as SFR's. SFR's allow a person choice of liquidation via revenue valuation OR retail O.O. valuation, you don't get that with MFH. Capitol costs are less, inventory is more available, less regulatory impact, more options for monetization, financing is simpler, accessing equity is simpler and more available, operation options are simpler and with greater control.
Reality is for the vast majority who seek Cadillac $ not Lambo $, value simplicity, control, reliability and consistency, SFR's reign supreme, they do.
MFH's is for scale, 100%. But as said, not everyone or even the majority want to scale, they simply don't.
Hi James,
> Community level MFH is the simplest most passive means to effectively be invested in real estate at significant $ levels. But that is the rub, it's a ~$40m+ "pay-to-play" game.
You can participate in a syndication for a minimum investment typically in the $25k to $100k range. You certainly don’t need millions to participate in a syndication. Indeed, compared to buying a single-family rental in many markets, the entry price into a syndication can be significantly lower than the down payment required to buy a rental.
> I have seen the stark difference first hand, the vast majority simply do not desire to achieve "yacht $". Their goals are much more humble and focused toward simplicity.
I’m not interested in yachts, but I do know how to teach someone how to raise capital without it taking significant time. You can start with your own kids or siblings, raise tiny amounts of money. Raising even tiny amounts of money is highly educational, it forces you to analyze a deal properly, work out the likely return, keep your books properly, report results. There is a great deal of professionalism that comes with managing even a small amount of other people’s money.
> access to information is so available and so simple, there really is no barriers anymore. Via ai one doesn't even need to put much effort into seaking out the info, one can literally talk to the GPT of choice, for free, and get answers, direction, action items, really everything needed. So again, were back to interest not access being the primary issue.
Most people don’t know what is possible. They don’t know what questions to ask. The wonderful thing about bigger pockets as you get exposed to people doing things you didn’t know were possible. The goal is for everyone to network and for the community to inspire everyone to do more than they thought could be done. I know how to start a managed fund with just $15k in legal fees that gives you the right to advertise publicly and raise up to $150 million. Chat GPT can’t teach you that --- I just asked it and it said it wasn’t possible :-)
> most don't care to scale
I disagree. I’m not sure why you would even say that. While there might be some people that are content where they are and do not wish to scale, I would suspect that the vast majority of people spending time on bigger pockets are looking for ways to grow. Anyone with a growth mindset is always looking for ways to grow.
> I find many "main street" investors consider their "wealth" at $10kmnth inflation adjusted passive income, and the vast majority consider $20k mnth passive income "Great wealth". In the market's I play in, that's readily acheive with less than 10 free & clear SFR's. Or 20 moderately leveraged SFR's. Add in 15% - 20% for security buffer, that's a small, simple, easily managed portfolio that provides flexibility (ie options and control) on how one chooses to run their portfolio and life.
Getting to 10 to 20 rentals definitely meets my definition of scaling. Particularly if they are significantly paid off. Note that this is not a modest goal. Only a tiny fraction of people in the US can ever own so many rentals. 35% of households rent. Most investors with rentals have only a handful. The percent of people that can ever own 20 rentals is definitely less than 1%.
> Nobody ever cares about your $, like you do; this is the credo of main-street investors.
I would argue that many people are actually quite careless with their own money. They see something interesting, and don’t do enough due diligence, and allocate capital to it. When you do due diligence in a group, people in the group try to shoot down presented deals, and it forces people to be more thorough and careful in their analysis.
> Not to mention the loss of control, the dependency of not being self-capable.
Multifamily syndication deals are complex, many moving parts, lots of things to check. It is definitely not an advantage to try to analyze one on your own.
> I know of a great many who have acheived financial freedom without significant scale.
Can you be more specific? The example you gave above of 10 to 20 rentals is not something most people can do. The math of how many owners there are to renters doesn’t enable many people to own that much property.
> 20-40 is very reasonable to manage in a number of simple ways.
Yes, but not a reasonable target for the vast majority of people. At 40 properties you really are looking at maybe 0.1% of the population or less that can mathematically hold so many properties. Every such owner must have 40 households of tenants. I like being involved in ground-up development because there are so many things that need to be built. So many opportunities to deploy capital to do good and expand the supply of housing.
> MFH is not nearly as liquid as SFR's.
For most people, selling a SFR takes significant time with significant fees. As does buying one. If you invest in multifamily as a group, there are no acquisition fees, and if you need to exit you can sell your stake to another member of the group. Multifamily is traditionally viewed as illiquid, but if you know what you're doing you can actually make it more liquid than SFRs. When you invest as a collaborative group, a collective of individuals supporting one another, the burden of due diligence is shared, operators get happy with the group because a single conversation thread reaches many people and so they bring good deals to the group, and the entire group gets liquidity where usually you would expect none. We have bought other investors out of multifamily stakes. It's not true that it is illiquid if you set things up right.
> SFR's allow a person choice of liquidation via revenue valuation OR retail O.O. valuation, you don't get that with MFH. Capitol costs are less, inventory is more available, less regulatory impact, more options for monetization, financing is simpler, accessing equity is simpler and more available, operation options are simpler and with greater control.
I invest in other people’s syndications. I’m not involved in the financing, I’m not sourcing equity, I’m not running the operation. When it comes to opportunities as a passive investor, there are a vast ocean of deals available. As mentioned you can liquidate a stake in a building under construction when you invest as a group in a syndication. Been there, done that. And the capital cost to buy a stake in a syndication can be significantly less than the capital cost to buy a single family home.
> Reality is for the vast majority who seek Cadillac $ not Lambo $, value simplicity, control, reliability and consistency, SFR's reign supreme, they do.
I drive a 2015 Hyundai Sonata. It’s beat up, and I love it. I will never own a Cadillac or a Lamborghini. That’s not what excites me. I like helping people grow. Way more exciting.
> MFH's is for scale, 100%. But as said, not everyone or even the majority want to scale, they simply don't.
I disagree that people on this forum don’t want to scale, they are just trying to work out how to do so. Why else would anyone spend time reading a post like this? I bought my first long-term rental in September 2020 and achieved financial freedom in May 2025, building out a multi tens of million dollar portfolio. My net worth after all lifestyle expenses increased by over $2.5 million in the last 12 months. I spend lots of times with my kids, and travel extensively. I’m generous with my time. If anyone reading this wants to learn how to do what I’ve done, they’re welcome to message me and I’ll happily explain it one-on-one. I share all I know and have built freely. No charge ever for anything. No secrets. Ask me anything.
- Investor · Reseda, CA · Member since 2019 · 297 posts · 150 votes1y
Quote from @Alan F.:
Once again, James unpacked the crux of the biscuit succinctly. Personally I'd like to go above Cadillac $, that being said "its easier said than done".Quote from @James Hamling:
Quote from @Austin Fowler:
Quote from @James Hamling:
Quote from @Austin Fowler:
Quote from @V.G Jason:
Quote from @Austin Fowler:
Quote from @V.G Jason:
Quote from @Gregory Schwartz:
Take $20M, pick up 50 single-family homes at ~$400k each. Rent them at $3k, net about $2k per door. That’s $100k/month in cash flow, plus appreciation. Low-maintenance properties, low-drama tenants, simple portfolio. It’s not flashy, but it’s clean, seats enough to self mange (for the REPS tax benefits), and lets you live well without headaches
$3k at $400k is hard, but possible. Have some higher, some lower, but mainly higher. You'll still have tenant issues, maintenance, etc. To think it'll be all roses is just naive. Fortunately have PMs, AI agents, etc.
With $10 mil continue to be focused on properties in Austin, and Phoenix. Doesn't change for me on the personal portfolio.
$1mil folks worry about protecting their wealth. $10mil folks focus on growing their wealth. But to get to the latter, you usually have to go through the former. Majority of this board shouldn't be focused on this problem though. Think it's just to sniff out potential investors for OPs fund.Hi V.G., the goal is to encourage actual real estate experts, actual people that operate at this scale, to share techniques that work at this scale and help educate people to head in that direction as well. If you anyone wants to operate at this scale, they need to focus on learning techniques that work at this scale. When it comes to building wealth, you can waste decades of your life learning labor intensive techniques and building a portfolio that simply doesn't scale.
I "operate" with more "scale" than 99% of BP.
And I'm telling you 99% needs to stop being obsessed with scale. And start being obsessed with diligence.You're getting it right from the horse's mouth, yet still want to push this point. It's missing the forest for the trees. You're trying to scale by acquiring outside capital, I get it. Go do that in a proper form.
Totally agree with a need for everyone to be obsessed with due diligence. For example, when I acquire an asset, it is a month+ long process involving hundreds of people doing group due diligence trying to find holes in the deal and learning more about it before anyone invests. It's an approach anyone can use. I disagree with the philosophy that there are some special people that use special techniques that are amazing and can't even be explained, and then a majority of average people that should stick with average techniques that don't scale. There are good investment techniques that anyone can use that are scalable. One example of such a technique is doing extensive group due diligence on passive multifamily. Another is simply cash or an index fund, neither of which chew up your time and scale arbitrarily. This thread is all about identifying scalable techniques that anyone can use. Or just interesting techniques that people have used at scale. Working together as a community to educate each other.
Scalability is easily and readily available for the vast majority, scalability is not the issue for most.
The issue for most is how limited their investment capitol is, the massive return expectations being sought, over an exceptionally short time-span.
Many seeking parabolic, unrealistic, compounding returns. Which are not really returns, as so many are actually seeking full income replacement via the "investing".
To boot, adding in the riders of things such as "passive", "low risk" and "certain"......
To be fair Austin, you as a syndicator are hacking the scalability via syndication, O.P.M.. Most are not capable, willing or interested in raising O.P.M. to scale and thus a natural limiter of there investible capitol.
Remove your LP capitol, you would not be at the size you are, correct? No syndicator would. So it's not fair to pretend it's the deals that make scalability alone. It is possible but it is very rare, exceptional and non-ordinary for such.
For the vast majority who are measuring their investible capitol in the tens of thousands, while balancing a FT career, a family, life in general, yes it is rare skills and talents to find, analyze and execute on profitable investments at any kind of regularized interval. And in those early steps, the outlay of capitol far outstrips the returns for years or decades limiting any reasonable expectation of scalability.
In my experience the primary focus for most is not on scalability but on certainty to achieve financial freedom. Which is often defined as a passive income about matching to current active income levels.
For most the only scalability that matters is how to get to their ends. I often see a correlation that this is meet for most between 20-40 SFR's.
For many, scaling beyond that is just added work, and no longer "freedom" as was the entire intent from start, financial freedom, not an occupation change.
Hi V.G.,
> Scalability is easily and readily available for the vast majority, scalability is not the issue for most.
When it comes to scalability, I set the bar high. I want to be able to handle a very great deal of capital deployed in a lot of assets while basically on holiday. Using this perspective, to my eyes many people spend a great deal of time working real estate investing techniques that are not scalable. Passive multifamily is the most scalable technique I currently use, and I could use my exact due diligence process to easily handle $100M without changing how I operate. Just bigger checks into the deals I find.
> In my case, The issue for most is how limited their investment capitol is, the massive return expectations being sought, over an exceptionally short time-span.
So how about we focus on discussing how to solve capital limitations in a way that is doable by anyone?
> Many seeking parabolic, unrealistic, compounding returns. Which are not really returns, as so many are actually seeking full income replacement via the "investing".
I don’t work a W-2 anymore. My investing covers all of my expenses and was sufficient to add $2.5M to my net worth over the last 12 months. Full income replacement is definitely achievable.
> To boot, adding in the riders of things such as "passive", "low risk" and "certain"......
> To be fair Austin, you as a syndicator are hacking the scalability via syndication, O.P.M..
I don’t run syndications. I do invest in other people syndications. I have no desire to be a GP on a multifamily syndication with all of the responsibilities and duties that come with it.
> Most are not capable, willing or interested in raising O.P.M. to scale and thus a natural limiter of there investible capitol.
Here I disagree. I think most people just don’t know how to go about it. I have helped hundreds of people learn how to raise capital for their own investing. I have helped quite a number of people start their own SEC registered managed funds. And there is an awful lot you can do with a lot less than this. It’s knowledge that people need.
> Remove your LP capitol, you would not be at the size you are, correct?
Correct.
> No syndicator would. So it's not fair to pretend it's the deals that make scalability alone.
The multifamily deals I focus on are not mine, and from a return point of view are nothing off the charts, the general target is around 20% per annum. And no, it’s not the deal that gets you to huge scale, it is definitely learning how to raise capital. And that is something anyone can learn, and the only way to get to great wealth in a lifetime.
> It is possible but it is very rare, exceptional and non-ordinary for such.
Agreed it is not about the deal, it is about learning how to access capital efficiently. And that is a teachable skill.
> For the vast majority who are measuring their investible capitol in the tens of thousands, while balancing a FT career, a family, life in general, yes it is rare skills and talents to find, analyze and execute on profitable investments at any kind of regularized interval. And in those early steps, the outlay of capitol far outstrips the returns for years or decades limiting any reasonable expectation of scalability.
So you share the load. You don’t try to do all of the deal due diligence yourself. You do it in a group where some (even most) people can even passively ride on the due diligence of others. You don’t try to reinvent the wheel when it comes to learning how to raise capital, you leverage free tools that already exist.
> In my experience the primary focus for most is not on scalability but on certainty to achieve financial freedom. Which is often defined as a passive income about matching to current active income levels.
Financial freedom requires passive investments at scale. Speaking from experience.
> For most the only scalability that matters is how to get to their ends. I often see a correlation that this is meet for most between 20-40 SFR's.
I would argue that self managing so many single-family rentals is a burden. I’m in that range with managed rentals, and I would say that this is definitely not enough for the level of financial freedom I wish to have, even if they were all paid off, which they aren’t.
> For many, scaling beyond that is just added work, and no longer "freedom" as was the entire intent from start, financial freedom, not an occupation change.
Agreed, but to say the same thing a different way, there are more profitable and more passive investments than single-family long-term rentals.
"....I want to be able to handle a very great deal of capital deployed in a lot of assets while basically on holiday.... Passive multifamily is the most scalable...., ....I could use my exact due diligence process to easily handle $100M without changing how I operate....."
To that end, as a person who's worked in this segment, I agree 100%, community level MFH is the simplest most passive means to effectively be invested in real estate at significant $ levels.
But that is the rub, it's a ~$40m+ "pay-to-play" game. That is a level that an exceptional small % of landlords acheive, or even have a desire to ever achieve. I used to work in private equity, I had 9 and even a few 10 figure clients, I know it's attainable, and how rare that ambition of scale is. Just because you possess it, does not mean it's shared by a majority.
"So how about we focus on discussing how to solve capital limitations in a way that is doable by anyone?"
In the sage wisdom of Ratatouille; anyone can cook, but not everyone can be great.
For those who want to, they can, OPM, it's just that simple and really there is no other way around it, it's just the reality of the math of things. Or they need to be hyper active in it to be able to achieve the parabolic returns from strategies that get to infinite returns in rapid order, ie not passive at all.
The issue is not inability, it's desire. I stepped down from the world of private equity on purpose to work with "average" John & Jane Doe's, from wall street too main street, sacrificing profit for passion of purpose. I have seen the stark difference first hand, the vast majority simply do not desire to achieve "yacht $". Their goals are much more humble and focused toward simplicity.
"....I think most people just don’t know how to go about it. I have helped hundreds of people learn how to raise capital for their own investing. ....It’s knowledge that people need."
For some, very true. Although in this day and age, access to information is so available and so simple, there really is no barriers anymore. Via ai one doesn't even need to put much effort into seaking out the info, one can literally talk to the GPT of choice, for free, and get answers, direction, action items, really everything needed. So again, were back to interest not access being the primary issue.
"....no, it’s not the deal that gets you to huge scale, it is definitely learning how to raise capital. And that is something anyone can learn, and the only way to get to great wealth in a lifetime."
Yes, as I said scalability is readily available.... for those who want it, but that's the point, most don't care to scale, they don't, they want a certain passive income as simply, safely, and quickly as possible.
As for scale being the "only way to get to great wealth", I couldn't disagree more. yes, it is a way, but not the only way. Not to mention "great wealth" is a perceptual thing, for one that may be $100m, another it may be $1b, and for another it may be $50k a year.
I find many "main street" investors consider their "wealth" at $10kmnth inflation adjusted passive income, and the vast majority consider $20k mnth passive income "Great wealth". In the market's I play in, that's readily acheive with less than 10 free & clear SFR's. Or 20 moderately leveraged SFR's. Add in 15% - 20% for security buffer, that's a small, simple, easily managed portfolio that provides flexibility (ie options and control) on how one chooses to run their portfolio and life.
Again, massive scale is not of interest for everyone, or even most.
"So you share the load. You don’t try to do all of the deal due diligence yourself. You do it in a group...."
Nobody ever cares about your $, like you do; this is the credo of main-street investors. Not to mention the loss of control, the dependency of not being self-capable. That equals fear for most on main street, not safety or security. This is antigen to the pursuit of financial FREEDOM, freedom is independence.
"Financial freedom requires passive investments at scale."
Again, strongly disagree. I know of a great many who have acheived financial freedom without significant scale. Again, financial freedom is a perceptual thing that is different and personal person to person. The scale to meet that bar will vary person 2 person, and most are rather humble bars to meet.
"I would argue that self managing so many single-family rentals is a burden."
Well, it can be, it depends on the person, there abilaties, and how savy they are to get professionals when and where one is needed to hire their problems away. Those who do that, can find it very very simple. My best average was managing 184 properties in 7hrs a week, measured over a quarter. Me, as in me, personally actively managing them, not my PM's. So it's doable. I spent 8 months building out the systems and structure to get there but point is, 20-40 is very reasonable to manage in a number of simple ways.
"there are more profitable and more passive investments than single-family long-term rentals."
I disagree, and I have the math to back me up. MFH is not nearly as liquid as SFR's. SFR's allow a person choice of liquidation via revenue valuation OR retail O.O. valuation, you don't get that with MFH. Capitol costs are less, inventory is more available, less regulatory impact, more options for monetization, financing is simpler, accessing equity is simpler and more available, operation options are simpler and with greater control.
Reality is for the vast majority who seek Cadillac $ not Lambo $, value simplicity, control, reliability and consistency, SFR's reign supreme, they do.
MFH's is for scale, 100%. But as said, not everyone or even the majority want to scale, they simply don't.
As someone who's (legitimately) employed dozens of people, written SOPS's, payroll taxes et al, while investing on the side the most valuable lessons I've learned is human nature.
I recall a quote by VG Jason, once you've hit basic accreditation...wealth preservation becomes a high priority (paraphrased)
I've learned, the hard way, as James noted, that no one cares about my $ like I do. Networking is much harder than people portray on this forum, as such I see a few ways of interacting with people; W2 employees were I follow all CA laws, genuine relationships with trusted friends in a belly to belly fashion & contractual/transactual relationships that are enforceable.
An older guy once told me "trust is earned, not given"
The appealing aspect of REI, to me, is that its a tangible/touchable asset where I can affect a difference. Passivity within this industry is is very concerning to me.Hi Alan,
> Networking is much harder than people portray on this forum, as such I see a few ways of interacting with people
It all starts with a simple direct message. Message me and I’ll be happy to talk with you one-on-one. I don’t see any barriers to networking on this platform. Same goes with anyone reading this. If you message me, I’ll respond.
- Real Estate Broker · Minneapolis, MN · Member since 2011 · 5k+ posts · 6k+ votes1y
Quote from @Austin Fowler:
Quote from @James Hamling:
Quote from @Austin Fowler:
Quote from @James Hamling:
Quote from @Austin Fowler:
Quote from @V.G Jason:
Quote from @Austin Fowler:
Quote from @V.G Jason:
Quote from @Gregory Schwartz:
Take $20M, pick up 50 single-family homes at ~$400k each. Rent them at $3k, net about $2k per door. That’s $100k/month in cash flow, plus appreciation. Low-maintenance properties, low-drama tenants, simple portfolio. It’s not flashy, but it’s clean, seats enough to self mange (for the REPS tax benefits), and lets you live well without headaches
$3k at $400k is hard, but possible. Have some higher, some lower, but mainly higher. You'll still have tenant issues, maintenance, etc. To think it'll be all roses is just naive. Fortunately have PMs, AI agents, etc.
With $10 mil continue to be focused on properties in Austin, and Phoenix. Doesn't change for me on the personal portfolio.
$1mil folks worry about protecting their wealth. $10mil folks focus on growing their wealth. But to get to the latter, you usually have to go through the former. Majority of this board shouldn't be focused on this problem though. Think it's just to sniff out potential investors for OPs fund.Hi V.G., the goal is to encourage actual real estate experts, actual people that operate at this scale, to share techniques that work at this scale and help educate people to head in that direction as well. If you anyone wants to operate at this scale, they need to focus on learning techniques that work at this scale. When it comes to building wealth, you can waste decades of your life learning labor intensive techniques and building a portfolio that simply doesn't scale.
I "operate" with more "scale" than 99% of BP.
And I'm telling you 99% needs to stop being obsessed with scale. And start being obsessed with diligence.You're getting it right from the horse's mouth, yet still want to push this point. It's missing the forest for the trees. You're trying to scale by acquiring outside capital, I get it. Go do that in a proper form.
Totally agree with a need for everyone to be obsessed with due diligence. For example, when I acquire an asset, it is a month+ long process involving hundreds of people doing group due diligence trying to find holes in the deal and learning more about it before anyone invests. It's an approach anyone can use. I disagree with the philosophy that there are some special people that use special techniques that are amazing and can't even be explained, and then a majority of average people that should stick with average techniques that don't scale. There are good investment techniques that anyone can use that are scalable. One example of such a technique is doing extensive group due diligence on passive multifamily. Another is simply cash or an index fund, neither of which chew up your time and scale arbitrarily. This thread is all about identifying scalable techniques that anyone can use. Or just interesting techniques that people have used at scale. Working together as a community to educate each other.
Scalability is easily and readily available for the vast majority, scalability is not the issue for most.
The issue for most is how limited their investment capitol is, the massive return expectations being sought, over an exceptionally short time-span.
Many seeking parabolic, unrealistic, compounding returns. Which are not really returns, as so many are actually seeking full income replacement via the "investing".
To boot, adding in the riders of things such as "passive", "low risk" and "certain"......
To be fair Austin, you as a syndicator are hacking the scalability via syndication, O.P.M.. Most are not capable, willing or interested in raising O.P.M. to scale and thus a natural limiter of there investible capitol.
Remove your LP capitol, you would not be at the size you are, correct? No syndicator would. So it's not fair to pretend it's the deals that make scalability alone. It is possible but it is very rare, exceptional and non-ordinary for such.
For the vast majority who are measuring their investible capitol in the tens of thousands, while balancing a FT career, a family, life in general, yes it is rare skills and talents to find, analyze and execute on profitable investments at any kind of regularized interval. And in those early steps, the outlay of capitol far outstrips the returns for years or decades limiting any reasonable expectation of scalability.
In my experience the primary focus for most is not on scalability but on certainty to achieve financial freedom. Which is often defined as a passive income about matching to current active income levels.
For most the only scalability that matters is how to get to their ends. I often see a correlation that this is meet for most between 20-40 SFR's.
For many, scaling beyond that is just added work, and no longer "freedom" as was the entire intent from start, financial freedom, not an occupation change.
Hi V.G.,
> Scalability is easily and readily available for the vast majority, scalability is not the issue for most.
When it comes to scalability, I set the bar high. I want to be able to handle a very great deal of capital deployed in a lot of assets while basically on holiday. Using this perspective, to my eyes many people spend a great deal of time working real estate investing techniques that are not scalable. Passive multifamily is the most scalable technique I currently use, and I could use my exact due diligence process to easily handle $100M without changing how I operate. Just bigger checks into the deals I find.
> In my case, The issue for most is how limited their investment capitol is, the massive return expectations being sought, over an exceptionally short time-span.
So how about we focus on discussing how to solve capital limitations in a way that is doable by anyone?
> Many seeking parabolic, unrealistic, compounding returns. Which are not really returns, as so many are actually seeking full income replacement via the "investing".
I don’t work a W-2 anymore. My investing covers all of my expenses and was sufficient to add $2.5M to my net worth over the last 12 months. Full income replacement is definitely achievable.
> To boot, adding in the riders of things such as "passive", "low risk" and "certain"......
> To be fair Austin, you as a syndicator are hacking the scalability via syndication, O.P.M..
I don’t run syndications. I do invest in other people syndications. I have no desire to be a GP on a multifamily syndication with all of the responsibilities and duties that come with it.
> Most are not capable, willing or interested in raising O.P.M. to scale and thus a natural limiter of there investible capitol.
Here I disagree. I think most people just don’t know how to go about it. I have helped hundreds of people learn how to raise capital for their own investing. I have helped quite a number of people start their own SEC registered managed funds. And there is an awful lot you can do with a lot less than this. It’s knowledge that people need.
> Remove your LP capitol, you would not be at the size you are, correct?
Correct.
> No syndicator would. So it's not fair to pretend it's the deals that make scalability alone.
The multifamily deals I focus on are not mine, and from a return point of view are nothing off the charts, the general target is around 20% per annum. And no, it’s not the deal that gets you to huge scale, it is definitely learning how to raise capital. And that is something anyone can learn, and the only way to get to great wealth in a lifetime.
> It is possible but it is very rare, exceptional and non-ordinary for such.
Agreed it is not about the deal, it is about learning how to access capital efficiently. And that is a teachable skill.
> For the vast majority who are measuring their investible capitol in the tens of thousands, while balancing a FT career, a family, life in general, yes it is rare skills and talents to find, analyze and execute on profitable investments at any kind of regularized interval. And in those early steps, the outlay of capitol far outstrips the returns for years or decades limiting any reasonable expectation of scalability.
So you share the load. You don’t try to do all of the deal due diligence yourself. You do it in a group where some (even most) people can even passively ride on the due diligence of others. You don’t try to reinvent the wheel when it comes to learning how to raise capital, you leverage free tools that already exist.
> In my experience the primary focus for most is not on scalability but on certainty to achieve financial freedom. Which is often defined as a passive income about matching to current active income levels.
Financial freedom requires passive investments at scale. Speaking from experience.
> For most the only scalability that matters is how to get to their ends. I often see a correlation that this is meet for most between 20-40 SFR's.
I would argue that self managing so many single-family rentals is a burden. I’m in that range with managed rentals, and I would say that this is definitely not enough for the level of financial freedom I wish to have, even if they were all paid off, which they aren’t.
> For many, scaling beyond that is just added work, and no longer "freedom" as was the entire intent from start, financial freedom, not an occupation change.
Agreed, but to say the same thing a different way, there are more profitable and more passive investments than single-family long-term rentals.
"....I want to be able to handle a very great deal of capital deployed in a lot of assets while basically on holiday.... Passive multifamily is the most scalable...., ....I could use my exact due diligence process to easily handle $100M without changing how I operate....."
To that end, as a person who's worked in this segment, I agree 100%, community level MFH is the simplest most passive means to effectively be invested in real estate at significant $ levels.
But that is the rub, it's a ~$40m+ "pay-to-play" game. That is a level that an exceptional small % of landlords acheive, or even have a desire to ever achieve. I used to work in private equity, I had 9 and even a few 10 figure clients, I know it's attainable, and how rare that ambition of scale is. Just because you possess it, does not mean it's shared by a majority.
"So how about we focus on discussing how to solve capital limitations in a way that is doable by anyone?"
In the sage wisdom of Ratatouille; anyone can cook, but not everyone can be great.
For those who want to, they can, OPM, it's just that simple and really there is no other way around it, it's just the reality of the math of things. Or they need to be hyper active in it to be able to achieve the parabolic returns from strategies that get to infinite returns in rapid order, ie not passive at all.
The issue is not inability, it's desire. I stepped down from the world of private equity on purpose to work with "average" John & Jane Doe's, from wall street too main street, sacrificing profit for passion of purpose. I have seen the stark difference first hand, the vast majority simply do not desire to achieve "yacht $". Their goals are much more humble and focused toward simplicity.
"....I think most people just don’t know how to go about it. I have helped hundreds of people learn how to raise capital for their own investing. ....It’s knowledge that people need."
For some, very true. Although in this day and age, access to information is so available and so simple, there really is no barriers anymore. Via ai one doesn't even need to put much effort into seaking out the info, one can literally talk to the GPT of choice, for free, and get answers, direction, action items, really everything needed. So again, were back to interest not access being the primary issue.
"....no, it’s not the deal that gets you to huge scale, it is definitely learning how to raise capital. And that is something anyone can learn, and the only way to get to great wealth in a lifetime."
Yes, as I said scalability is readily available.... for those who want it, but that's the point, most don't care to scale, they don't, they want a certain passive income as simply, safely, and quickly as possible.
As for scale being the "only way to get to great wealth", I couldn't disagree more. yes, it is a way, but not the only way. Not to mention "great wealth" is a perceptual thing, for one that may be $100m, another it may be $1b, and for another it may be $50k a year.
I find many "main street" investors consider their "wealth" at $10kmnth inflation adjusted passive income, and the vast majority consider $20k mnth passive income "Great wealth". In the market's I play in, that's readily acheive with less than 10 free & clear SFR's. Or 20 moderately leveraged SFR's. Add in 15% - 20% for security buffer, that's a small, simple, easily managed portfolio that provides flexibility (ie options and control) on how one chooses to run their portfolio and life.
Again, massive scale is not of interest for everyone, or even most.
"So you share the load. You don’t try to do all of the deal due diligence yourself. You do it in a group...."
Nobody ever cares about your $, like you do; this is the credo of main-street investors. Not to mention the loss of control, the dependency of not being self-capable. That equals fear for most on main street, not safety or security. This is antigen to the pursuit of financial FREEDOM, freedom is independence.
"Financial freedom requires passive investments at scale."
Again, strongly disagree. I know of a great many who have acheived financial freedom without significant scale. Again, financial freedom is a perceptual thing that is different and personal person to person. The scale to meet that bar will vary person 2 person, and most are rather humble bars to meet.
"I would argue that self managing so many single-family rentals is a burden."
Well, it can be, it depends on the person, there abilaties, and how savy they are to get professionals when and where one is needed to hire their problems away. Those who do that, can find it very very simple. My best average was managing 184 properties in 7hrs a week, measured over a quarter. Me, as in me, personally actively managing them, not my PM's. So it's doable. I spent 8 months building out the systems and structure to get there but point is, 20-40 is very reasonable to manage in a number of simple ways.
"there are more profitable and more passive investments than single-family long-term rentals."
I disagree, and I have the math to back me up. MFH is not nearly as liquid as SFR's. SFR's allow a person choice of liquidation via revenue valuation OR retail O.O. valuation, you don't get that with MFH. Capitol costs are less, inventory is more available, less regulatory impact, more options for monetization, financing is simpler, accessing equity is simpler and more available, operation options are simpler and with greater control.
Reality is for the vast majority who seek Cadillac $ not Lambo $, value simplicity, control, reliability and consistency, SFR's reign supreme, they do.
MFH's is for scale, 100%. But as said, not everyone or even the majority want to scale, they simply don't.
Hi James,
> Community level MFH is the simplest most passive means to effectively be invested in real estate at significant $ levels. But that is the rub, it's a ~$40m+ "pay-to-play" game.
You can participate in a syndication for a minimum investment typically in the $25k to $100k range. You certainly don’t need millions to participate in a syndication. Indeed, compared to buying a single-family rental in many markets, the entry price into a syndication can be significantly lower than the down payment required to buy a rental.
> I have seen the stark difference first hand, the vast majority simply do not desire to achieve "yacht $". Their goals are much more humble and focused toward simplicity.
I’m not interested in yachts, but I do know how to teach someone how to raise capital without it taking significant time. You can start with your own kids or siblings, raise tiny amounts of money. Raising even tiny amounts of money is highly educational, it forces you to analyze a deal properly, work out the likely return, keep your books properly, report results. There is a great deal of professionalism that comes with managing even a small amount of other people’s money.
> access to information is so available and so simple, there really is no barriers anymore. Via ai one doesn't even need to put much effort into seaking out the info, one can literally talk to the GPT of choice, for free, and get answers, direction, action items, really everything needed. So again, were back to interest not access being the primary issue.
Most people don’t know what is possible. They don’t know what questions to ask. The wonderful thing about bigger pockets as you get exposed to people doing things you didn’t know were possible. The goal is for everyone to network and for the community to inspire everyone to do more than they thought could be done. I know how to start a managed fund with just $15k in legal fees that gives you the right to advertise publicly and raise up to $150 million. Chat GPT can’t teach you that --- I just asked it and it said it wasn’t possible :-)
> most don't care to scale
I disagree. I’m not sure why you would even say that. While there might be some people that are content where they are and do not wish to scale, I would suspect that the vast majority of people spending time on bigger pockets are looking for ways to grow. Anyone with a growth mindset is always looking for ways to grow.
> I find many "main street" investors consider their "wealth" at $10kmnth inflation adjusted passive income, and the vast majority consider $20k mnth passive income "Great wealth". In the market's I play in, that's readily acheive with less than 10 free & clear SFR's. Or 20 moderately leveraged SFR's. Add in 15% - 20% for security buffer, that's a small, simple, easily managed portfolio that provides flexibility (ie options and control) on how one chooses to run their portfolio and life.
Getting to 10 to 20 rentals definitely meets my definition of scaling. Particularly if they are significantly paid off. Note that this is not a modest goal. Only a tiny fraction of people in the US can ever own so many rentals. 35% of households rent. Most investors with rentals have only a handful. The percent of people that can ever own 20 rentals is definitely less than 1%.
> Nobody ever cares about your $, like you do; this is the credo of main-street investors.
I would argue that many people are actually quite careless with their own money. They see something interesting, and don’t do enough due diligence, and allocate capital to it. When you do due diligence in a group, people in the group try to shoot down presented deals, and it forces people to be more thorough and careful in their analysis.
> Not to mention the loss of control, the dependency of not being self-capable.
Multifamily syndication deals are complex, many moving parts, lots of things to check. It is definitely not an advantage to try to analyze one on your own.
> I know of a great many who have acheived financial freedom without significant scale.
Can you be more specific? The example you gave above of 10 to 20 rentals is not something most people can do. The math of how many owners there are to renters doesn’t enable many people to own that much property.
> 20-40 is very reasonable to manage in a number of simple ways.
Yes, but not a reasonable target for the vast majority of people. At 40 properties you really are looking at maybe 0.1% of the population or less that can mathematically hold so many properties. Every such owner must have 40 households of tenants. I like being involved in ground-up development because there are so many things that need to be built. So many opportunities to deploy capital to do good and expand the supply of housing.
> MFH is not nearly as liquid as SFR's.
For most people, selling a SFR takes significant time with significant fees. As does buying one. If you invest in multifamily as a group, there are no acquisition fees, and if you need to exit you can sell your stake to another member of the group. Multifamily is traditionally viewed as illiquid, but if you know what you're doing you can actually make it more liquid than SFRs. When you invest as a collaborative group, a collective of individuals supporting one another, the burden of due diligence is shared, operators get happy with the group because a single conversation thread reaches many people and so they bring good deals to the group, and the entire group gets liquidity where usually you would expect none. We have bought other investors out of multifamily stakes. It's not true that it is illiquid if you set things up right.
> SFR's allow a person choice of liquidation via revenue valuation OR retail O.O. valuation, you don't get that with MFH. Capitol costs are less, inventory is more available, less regulatory impact, more options for monetization, financing is simpler, accessing equity is simpler and more available, operation options are simpler and with greater control.
I invest in other people’s syndications. I’m not involved in the financing, I’m not sourcing equity, I’m not running the operation. When it comes to opportunities as a passive investor, there are a vast ocean of deals available. As mentioned you can liquidate a stake in a building under construction when you invest as a group in a syndication. Been there, done that. And the capital cost to buy a stake in a syndication can be significantly less than the capital cost to buy a single family home.
> Reality is for the vast majority who seek Cadillac $ not Lambo $, value simplicity, control, reliability and consistency, SFR's reign supreme, they do.
I drive a 2015 Hyundai Sonata. It’s beat up, and I love it. I will never own a Cadillac or a Lamborghini. That’s not what excites me. I like helping people grow. Way more exciting.
> MFH's is for scale, 100%. But as said, not everyone or even the majority want to scale, they simply don't.
I disagree that people on this forum don’t want to scale, they are just trying to work out how to do so. Why else would anyone spend time reading a post like this? I bought my first long-term rental in September 2020 and achieved financial freedom in May 2025, building out a multi tens of million dollar portfolio. My net worth after all lifestyle expenses increased by over $2.5 million in the last 12 months. I spend lots of times with my kids, and travel extensively. I’m generous with my time. If anyone reading this wants to learn how to do what I’ve done, they’re welcome to message me and I’ll happily explain it one-on-one. I share all I know and have built freely. No charge ever for anything. No secrets. Ask me anything.
> You certainly don’t need millions to participate in a syndication. Indeed, compared to buying a single-family rental in many markets, the entry price into a syndication can be significantly lower than the down payment required to buy a rental.
In some instances that is true, and in a great many of instances it's about the same $ investment. BUT, and it's a very big but; when a person uses their $ to purchase a property they are in direct control. In a syndication, their along for the ride. Next big but is, when acquire a property their empowered to multiply the income potential of their investment capital far more than in a syndication, as the leverage potentials are far greater. For example, if a persons does a very simplistic strategy of O.O. buy via a 10% down, live-in for 1yr, then buy another, move, lease out the previous unit. Or really any # of effective leverage strategies such as house hacking, BRRR, value-add etc etc..
> Raising even tiny amounts of money is highly educational, it forces you to analyze a deal properly, work out the likely return, keep your books properly, report results. There is a great deal of professionalism that comes with managing even a small amount of other people’s money.
That's an intriguing point.... I find the vast majority view such as added work, stress, responsibility and accountability unto others which translates to a loss of freedom and added risk. I like the forced edu aspect, I do, although I think your missing how strong the desire of independence is in most.
> I know how to start a managed fund with just $15k in legal fees that gives you the right to advertise publicly and raise up to $150 million. Chat GPT can’t teach you that.
$15k is exceptionally cheap for such. Although as both you and I know there is a lot more to it then just that baseline empowerment. The real struggles come in for most in operational management. And next in deal flow. These 2 factors are often a stopping point, because it's work, work that many do not desire to take on.
> "most don't care to scale" ----> I disagree. I’m not sure why you would even say that.
Because that is the reality from the front line, this is as I experience it.
The first a foremost service I provide investors of all kinds is as an advisor. Everyone starts with a consult, and I have a long list of investors of every kind, size and level from 0 too gigantic who utilize me as a sounding board, a consultant, to discuss, strategize, plan development, strategy review etc etc.. Just yesterday I spent an hour with an investor most would ask why such a wildly successful multi-millionaire would "need" advice and consulting. Because a very common theme of successful people is circling themselves with mentors and advisors, seeking review of ideas and concepts, they are knowledge miners.
So with that I talk with a lot of people on a regular basis, discussing goals and setting resource and desire fences.
And with that experience of hundreds upon hundreds, the vast majority, 92%+, express not only no desire to syndicate but also no desire to scale exponentially.
The prevailing desire is to achieve the desired financial ends, in the most expedient means possible, within their risk appetite, as simply as possible with least impact and intrusion into their active daily lives.
That simply is the prevailing majority of mindsets out there.
> ....10 to 20 rentals.... ....this is not a modest goal. Only a tiny fraction of people in the US can ever own so many rentals. 35% of households rent. The percent of people that can ever own 20 rentals is definitely less than 1%.
This is very incorrect information, and incorrect perception.
The US has been in process for some time now of the scale flipping from majority ownership too majority tenancy. As Clause announced to the world, and was actually the theme of the summit: "You will own nothing, and be HAPPY". The # consistently put out there for years now across various paradigms of groups has been a projection of 60% tenancy. It's been reiterated to such extent that one has to wonder if it isn't more-so a quota then a projection. Especially with fact that markets have been consistently moving more and more toward achieving this "quota".
As for ability to achieving such, my clients have a 98.5% chance of achieving it and I say that only because nothing is 100% in life other than tax's and death. The only question is not on ones ability to achieve it but if they will put in the work, follow the plan, execute on the steps required to achieve this end.
It is not a mysterious mythical impossible thing. It is a mathematical thing, very literally a math equation. The work I do is to assist people to develop their equation, from there is simply the work of doing the math.
Just like any business, it's all about methodology vs chance and randomness. Any who operate via chance and random actions will of course reap random results.
> I would argue that many people are actually quite careless with their own money.
Many do act financially careless, but that does not change how much they CARE for their money. Your comingling financial literacy with care, they are 2 very different things.
One could have the strongest of interest and passion in being a NASCAR driver, and when jump behind the wheel find their a horrific driver. Being a horrific driver does not mean they lack care and passion for it, it means they lack the skills and knowledge to properly execute on their care and passions.
And to their defense, the entire public USA system is designed to produce good little consumers, NOT investors or wealth. Consumerism is the status quo of USA. Wealth, independence and financial freedom is not the design for the masses and thus, of course financial neglect is the norm, it's what's literally taught and promoted popularly.
> The example you gave above of 10 to 20 rentals is not something most people can do.
Incorrect, the vast majority can achieve this rather low bar, the only question is what the path is for the specific person and will they execute on the actions to get them there.
The first step is universal, active income production to empower investible capitol. In this day and age a side-hustle is just far to simple for everyone to have one. There is no excuses to not take these active income steps. If one is unwilling then they are not serious about ever achieving the ends.
Next is appreciation. Appreciation is the #1 most important ingredient to growth. In what form and fashion this takes, again, is very person to the individual and get's detailed in their person development plan. Appreciation is paramount because via appreciation is how we can Pyramid.
This leads into the next key aspect, pyramiding. Pyramiding is how we can achieve infinite returns. Infinite returns is how we achieve rapid rates of growth.
There is many details to it all which again, various person to person as it's personal to their resources, natural empowerments and natural disadvantageous. The how can vary wildly but the general picture is the same; embrace natural advantageous and utilize them effectively, mitigate the weak points, appreciation to empower pyramiding, pyramiding to achieve infinite returns, infinite returns to grow assets under control, grow assets under control to achieve level of assets to then "flip the switch" too debt paydown via OPM, to achieve and end of certain level of passive income debt free.
It is a math game, plain n simple. With strategy to execute and best express the math.
And yes, if wondering, yes, I am "the" definitive strategist. Sun Tzu is my messiah.
> If you invest in multifamily as a group, there are no acquisition fees.
That is exceptionally false, and misleading at best if not patently fraudulent.
A MFH transaction has costs of transaction just like SFR's. Their is agency costs, legal facilitator costs, inspections, not to mention GP's fee's on top of it all, and so on and so fourth. Those costs are either seen and known, or encapsulated into whatever generalized price one is paying. There is no magic MFH leprechaun empowering a cost free transaction of real estate.
> I invest in other people’s syndications. ....I’m not running the operation.
For a large majority of people, that is a giant risk position, it's fearful and uncomfortable to have such loss of control. And there is a great number of stories speaking of the risks come to pass, and the substantial loss of $ from such horrors realized.
It is all great and fun, until it isn't, and then it's a living nightmare.
> I like helping people grow. Way more exciting.
And i applaud you for that. Sad truth is, it's not universal, and all too many in the syndication space hold very different motives and focuses, ones not aligned to the best interest's of the LP's. It is very much so a world of LP's can make $ if and when GP's do, and if GP's don't, oh-well, sorry for your loss LP's, and onto the next....
> I disagree that people on this forum don’t want to scale, they are just trying to work out how to do so. Why else would anyone spend time reading a post like this?
Because they want to profit. The vast majority are seeking out how-to, but don't want to put in the work for the how-to, so they keep looking around, seeking their "Golden Ticket" because of some belief that there is some easy, simple, risk free thing out there and that is how "those" people got rich. The have-not's hold a popular sentiment that the have's got to where they are via some hidden secret, access to something, a knowing of something, a connection, tip, trick or hack.
The secret is, there is no secret.
Somewhere out their is someone who's wildly wealthy via urinal cakes.... Another via running a boring manufacturing plant making paper straws.
Wealth is all around us all the time, literally millions upon millions around this world achieving it coming from nothing. That is the majority, the minority inherit.
And a prevailing story is of putting in the work, over time, methodically, consistently.
One has to first choose to be wealthy, second accept to put in the time and the work to walk-the-walk, and third SHOW-UP day after day after week after month after year after year.
Wealth is a RESULT, not a thing in and of itself.
Add 1, to 1, and you will get 2. If one set's to their equation, does the actions of addition, the results are inevitable.
Syndications are and always will be risky because one is putting their financial future in the hands of others, they are relinquishing control. That is a fearful thing for many, and rightfully so.
Does it mean syndications are bad? No. They are what they are.
Syndications are right for some and not for most. Why not for most? Because a very common thread of those seeking or living as REI's is a passion for FREEDOM. FREEEEEEE-DOM! It's the spirit that literally forged this nation.
And the dependency that is a feature of syndications, is an impediment on this spirit of freedom.
Go back a few hundred years and many of us would be the same people jumping on a ship to cross uncharted waters to craft unknown lives. It less a passion for the currency and more a passion for the LIFE of self actuation. A life of choice, unhindered by the necessity to do ___ to pay ___ so we can live ____. Financial freedom means life freedom, freedom of self, liberation from the shackles of j.o.b's.
If money stopped existing, what would you be doing? Everything, every resource in such plentiful that $ no longer exist.....
That's the true deep desire of most seeking financial freedom, it's not about the financial as much as it is about freedom. And hence scaling is just not an interest for most, not nearly as much as simplicity and expediency to get too freedom.
More is not more for many of us, it's just more......
- Investor · Reseda, CA · Member since 2019 · 297 posts · 150 votes1y
Quote from @James Hamling:
Quote from @Austin Fowler:
Quote from @James Hamling:
Quote from @Austin Fowler:
Quote from @James Hamling:
Quote from @Austin Fowler:
Quote from @V.G Jason:
Quote from @Austin Fowler:
Quote from @V.G Jason:
Quote from @Gregory Schwartz:
Take $20M, pick up 50 single-family homes at ~$400k each. Rent them at $3k, net about $2k per door. That’s $100k/month in cash flow, plus appreciation. Low-maintenance properties, low-drama tenants, simple portfolio. It’s not flashy, but it’s clean, seats enough to self mange (for the REPS tax benefits), and lets you live well without headaches
$3k at $400k is hard, but possible. Have some higher, some lower, but mainly higher. You'll still have tenant issues, maintenance, etc. To think it'll be all roses is just naive. Fortunately have PMs, AI agents, etc.
With $10 mil continue to be focused on properties in Austin, and Phoenix. Doesn't change for me on the personal portfolio.
$1mil folks worry about protecting their wealth. $10mil folks focus on growing their wealth. But to get to the latter, you usually have to go through the former. Majority of this board shouldn't be focused on this problem though. Think it's just to sniff out potential investors for OPs fund.Hi V.G., the goal is to encourage actual real estate experts, actual people that operate at this scale, to share techniques that work at this scale and help educate people to head in that direction as well. If you anyone wants to operate at this scale, they need to focus on learning techniques that work at this scale. When it comes to building wealth, you can waste decades of your life learning labor intensive techniques and building a portfolio that simply doesn't scale.
I "operate" with more "scale" than 99% of BP.
And I'm telling you 99% needs to stop being obsessed with scale. And start being obsessed with diligence.You're getting it right from the horse's mouth, yet still want to push this point. It's missing the forest for the trees. You're trying to scale by acquiring outside capital, I get it. Go do that in a proper form.
Totally agree with a need for everyone to be obsessed with due diligence. For example, when I acquire an asset, it is a month+ long process involving hundreds of people doing group due diligence trying to find holes in the deal and learning more about it before anyone invests. It's an approach anyone can use. I disagree with the philosophy that there are some special people that use special techniques that are amazing and can't even be explained, and then a majority of average people that should stick with average techniques that don't scale. There are good investment techniques that anyone can use that are scalable. One example of such a technique is doing extensive group due diligence on passive multifamily. Another is simply cash or an index fund, neither of which chew up your time and scale arbitrarily. This thread is all about identifying scalable techniques that anyone can use. Or just interesting techniques that people have used at scale. Working together as a community to educate each other.
Scalability is easily and readily available for the vast majority, scalability is not the issue for most.
The issue for most is how limited their investment capitol is, the massive return expectations being sought, over an exceptionally short time-span.
Many seeking parabolic, unrealistic, compounding returns. Which are not really returns, as so many are actually seeking full income replacement via the "investing".
To boot, adding in the riders of things such as "passive", "low risk" and "certain"......
To be fair Austin, you as a syndicator are hacking the scalability via syndication, O.P.M.. Most are not capable, willing or interested in raising O.P.M. to scale and thus a natural limiter of there investible capitol.
Remove your LP capitol, you would not be at the size you are, correct? No syndicator would. So it's not fair to pretend it's the deals that make scalability alone. It is possible but it is very rare, exceptional and non-ordinary for such.
For the vast majority who are measuring their investible capitol in the tens of thousands, while balancing a FT career, a family, life in general, yes it is rare skills and talents to find, analyze and execute on profitable investments at any kind of regularized interval. And in those early steps, the outlay of capitol far outstrips the returns for years or decades limiting any reasonable expectation of scalability.
In my experience the primary focus for most is not on scalability but on certainty to achieve financial freedom. Which is often defined as a passive income about matching to current active income levels.
For most the only scalability that matters is how to get to their ends. I often see a correlation that this is meet for most between 20-40 SFR's.
For many, scaling beyond that is just added work, and no longer "freedom" as was the entire intent from start, financial freedom, not an occupation change.
Hi V.G.,
> Scalability is easily and readily available for the vast majority, scalability is not the issue for most.
When it comes to scalability, I set the bar high. I want to be able to handle a very great deal of capital deployed in a lot of assets while basically on holiday. Using this perspective, to my eyes many people spend a great deal of time working real estate investing techniques that are not scalable. Passive multifamily is the most scalable technique I currently use, and I could use my exact due diligence process to easily handle $100M without changing how I operate. Just bigger checks into the deals I find.
> In my case, The issue for most is how limited their investment capitol is, the massive return expectations being sought, over an exceptionally short time-span.
So how about we focus on discussing how to solve capital limitations in a way that is doable by anyone?
> Many seeking parabolic, unrealistic, compounding returns. Which are not really returns, as so many are actually seeking full income replacement via the "investing".
I don’t work a W-2 anymore. My investing covers all of my expenses and was sufficient to add $2.5M to my net worth over the last 12 months. Full income replacement is definitely achievable.
> To boot, adding in the riders of things such as "passive", "low risk" and "certain"......
> To be fair Austin, you as a syndicator are hacking the scalability via syndication, O.P.M..
I don’t run syndications. I do invest in other people syndications. I have no desire to be a GP on a multifamily syndication with all of the responsibilities and duties that come with it.
> Most are not capable, willing or interested in raising O.P.M. to scale and thus a natural limiter of there investible capitol.
Here I disagree. I think most people just don’t know how to go about it. I have helped hundreds of people learn how to raise capital for their own investing. I have helped quite a number of people start their own SEC registered managed funds. And there is an awful lot you can do with a lot less than this. It’s knowledge that people need.
> Remove your LP capitol, you would not be at the size you are, correct?
Correct.
> No syndicator would. So it's not fair to pretend it's the deals that make scalability alone.
The multifamily deals I focus on are not mine, and from a return point of view are nothing off the charts, the general target is around 20% per annum. And no, it’s not the deal that gets you to huge scale, it is definitely learning how to raise capital. And that is something anyone can learn, and the only way to get to great wealth in a lifetime.
> It is possible but it is very rare, exceptional and non-ordinary for such.
Agreed it is not about the deal, it is about learning how to access capital efficiently. And that is a teachable skill.
> For the vast majority who are measuring their investible capitol in the tens of thousands, while balancing a FT career, a family, life in general, yes it is rare skills and talents to find, analyze and execute on profitable investments at any kind of regularized interval. And in those early steps, the outlay of capitol far outstrips the returns for years or decades limiting any reasonable expectation of scalability.
So you share the load. You don’t try to do all of the deal due diligence yourself. You do it in a group where some (even most) people can even passively ride on the due diligence of others. You don’t try to reinvent the wheel when it comes to learning how to raise capital, you leverage free tools that already exist.
> In my experience the primary focus for most is not on scalability but on certainty to achieve financial freedom. Which is often defined as a passive income about matching to current active income levels.
Financial freedom requires passive investments at scale. Speaking from experience.
> For most the only scalability that matters is how to get to their ends. I often see a correlation that this is meet for most between 20-40 SFR's.
I would argue that self managing so many single-family rentals is a burden. I’m in that range with managed rentals, and I would say that this is definitely not enough for the level of financial freedom I wish to have, even if they were all paid off, which they aren’t.
> For many, scaling beyond that is just added work, and no longer "freedom" as was the entire intent from start, financial freedom, not an occupation change.
Agreed, but to say the same thing a different way, there are more profitable and more passive investments than single-family long-term rentals.
"....I want to be able to handle a very great deal of capital deployed in a lot of assets while basically on holiday.... Passive multifamily is the most scalable...., ....I could use my exact due diligence process to easily handle $100M without changing how I operate....."
To that end, as a person who's worked in this segment, I agree 100%, community level MFH is the simplest most passive means to effectively be invested in real estate at significant $ levels.
But that is the rub, it's a ~$40m+ "pay-to-play" game. That is a level that an exceptional small % of landlords acheive, or even have a desire to ever achieve. I used to work in private equity, I had 9 and even a few 10 figure clients, I know it's attainable, and how rare that ambition of scale is. Just because you possess it, does not mean it's shared by a majority.
"So how about we focus on discussing how to solve capital limitations in a way that is doable by anyone?"
In the sage wisdom of Ratatouille; anyone can cook, but not everyone can be great.
For those who want to, they can, OPM, it's just that simple and really there is no other way around it, it's just the reality of the math of things. Or they need to be hyper active in it to be able to achieve the parabolic returns from strategies that get to infinite returns in rapid order, ie not passive at all.
The issue is not inability, it's desire. I stepped down from the world of private equity on purpose to work with "average" John & Jane Doe's, from wall street too main street, sacrificing profit for passion of purpose. I have seen the stark difference first hand, the vast majority simply do not desire to achieve "yacht $". Their goals are much more humble and focused toward simplicity.
"....I think most people just don’t know how to go about it. I have helped hundreds of people learn how to raise capital for their own investing. ....It’s knowledge that people need."
For some, very true. Although in this day and age, access to information is so available and so simple, there really is no barriers anymore. Via ai one doesn't even need to put much effort into seaking out the info, one can literally talk to the GPT of choice, for free, and get answers, direction, action items, really everything needed. So again, were back to interest not access being the primary issue.
"....no, it’s not the deal that gets you to huge scale, it is definitely learning how to raise capital. And that is something anyone can learn, and the only way to get to great wealth in a lifetime."
Yes, as I said scalability is readily available.... for those who want it, but that's the point, most don't care to scale, they don't, they want a certain passive income as simply, safely, and quickly as possible.
As for scale being the "only way to get to great wealth", I couldn't disagree more. yes, it is a way, but not the only way. Not to mention "great wealth" is a perceptual thing, for one that may be $100m, another it may be $1b, and for another it may be $50k a year.
I find many "main street" investors consider their "wealth" at $10kmnth inflation adjusted passive income, and the vast majority consider $20k mnth passive income "Great wealth". In the market's I play in, that's readily acheive with less than 10 free & clear SFR's. Or 20 moderately leveraged SFR's. Add in 15% - 20% for security buffer, that's a small, simple, easily managed portfolio that provides flexibility (ie options and control) on how one chooses to run their portfolio and life.
Again, massive scale is not of interest for everyone, or even most.
"So you share the load. You don’t try to do all of the deal due diligence yourself. You do it in a group...."
Nobody ever cares about your $, like you do; this is the credo of main-street investors. Not to mention the loss of control, the dependency of not being self-capable. That equals fear for most on main street, not safety or security. This is antigen to the pursuit of financial FREEDOM, freedom is independence.
"Financial freedom requires passive investments at scale."
Again, strongly disagree. I know of a great many who have acheived financial freedom without significant scale. Again, financial freedom is a perceptual thing that is different and personal person to person. The scale to meet that bar will vary person 2 person, and most are rather humble bars to meet.
"I would argue that self managing so many single-family rentals is a burden."
Well, it can be, it depends on the person, there abilaties, and how savy they are to get professionals when and where one is needed to hire their problems away. Those who do that, can find it very very simple. My best average was managing 184 properties in 7hrs a week, measured over a quarter. Me, as in me, personally actively managing them, not my PM's. So it's doable. I spent 8 months building out the systems and structure to get there but point is, 20-40 is very reasonable to manage in a number of simple ways.
"there are more profitable and more passive investments than single-family long-term rentals."
I disagree, and I have the math to back me up. MFH is not nearly as liquid as SFR's. SFR's allow a person choice of liquidation via revenue valuation OR retail O.O. valuation, you don't get that with MFH. Capitol costs are less, inventory is more available, less regulatory impact, more options for monetization, financing is simpler, accessing equity is simpler and more available, operation options are simpler and with greater control.
Reality is for the vast majority who seek Cadillac $ not Lambo $, value simplicity, control, reliability and consistency, SFR's reign supreme, they do.
MFH's is for scale, 100%. But as said, not everyone or even the majority want to scale, they simply don't.
Hi James,
> Community level MFH is the simplest most passive means to effectively be invested in real estate at significant $ levels. But that is the rub, it's a ~$40m+ "pay-to-play" game.
You can participate in a syndication for a minimum investment typically in the $25k to $100k range. You certainly don’t need millions to participate in a syndication. Indeed, compared to buying a single-family rental in many markets, the entry price into a syndication can be significantly lower than the down payment required to buy a rental.
> I have seen the stark difference first hand, the vast majority simply do not desire to achieve "yacht $". Their goals are much more humble and focused toward simplicity.
I’m not interested in yachts, but I do know how to teach someone how to raise capital without it taking significant time. You can start with your own kids or siblings, raise tiny amounts of money. Raising even tiny amounts of money is highly educational, it forces you to analyze a deal properly, work out the likely return, keep your books properly, report results. There is a great deal of professionalism that comes with managing even a small amount of other people’s money.
> access to information is so available and so simple, there really is no barriers anymore. Via ai one doesn't even need to put much effort into seaking out the info, one can literally talk to the GPT of choice, for free, and get answers, direction, action items, really everything needed. So again, were back to interest not access being the primary issue.
Most people don’t know what is possible. They don’t know what questions to ask. The wonderful thing about bigger pockets as you get exposed to people doing things you didn’t know were possible. The goal is for everyone to network and for the community to inspire everyone to do more than they thought could be done. I know how to start a managed fund with just $15k in legal fees that gives you the right to advertise publicly and raise up to $150 million. Chat GPT can’t teach you that --- I just asked it and it said it wasn’t possible :-)
> most don't care to scale
I disagree. I’m not sure why you would even say that. While there might be some people that are content where they are and do not wish to scale, I would suspect that the vast majority of people spending time on bigger pockets are looking for ways to grow. Anyone with a growth mindset is always looking for ways to grow.
> I find many "main street" investors consider their "wealth" at $10kmnth inflation adjusted passive income, and the vast majority consider $20k mnth passive income "Great wealth". In the market's I play in, that's readily acheive with less than 10 free & clear SFR's. Or 20 moderately leveraged SFR's. Add in 15% - 20% for security buffer, that's a small, simple, easily managed portfolio that provides flexibility (ie options and control) on how one chooses to run their portfolio and life.
Getting to 10 to 20 rentals definitely meets my definition of scaling. Particularly if they are significantly paid off. Note that this is not a modest goal. Only a tiny fraction of people in the US can ever own so many rentals. 35% of households rent. Most investors with rentals have only a handful. The percent of people that can ever own 20 rentals is definitely less than 1%.
> Nobody ever cares about your $, like you do; this is the credo of main-street investors.
I would argue that many people are actually quite careless with their own money. They see something interesting, and don’t do enough due diligence, and allocate capital to it. When you do due diligence in a group, people in the group try to shoot down presented deals, and it forces people to be more thorough and careful in their analysis.
> Not to mention the loss of control, the dependency of not being self-capable.
Multifamily syndication deals are complex, many moving parts, lots of things to check. It is definitely not an advantage to try to analyze one on your own.
> I know of a great many who have acheived financial freedom without significant scale.
Can you be more specific? The example you gave above of 10 to 20 rentals is not something most people can do. The math of how many owners there are to renters doesn’t enable many people to own that much property.
> 20-40 is very reasonable to manage in a number of simple ways.
Yes, but not a reasonable target for the vast majority of people. At 40 properties you really are looking at maybe 0.1% of the population or less that can mathematically hold so many properties. Every such owner must have 40 households of tenants. I like being involved in ground-up development because there are so many things that need to be built. So many opportunities to deploy capital to do good and expand the supply of housing.
> MFH is not nearly as liquid as SFR's.
For most people, selling a SFR takes significant time with significant fees. As does buying one. If you invest in multifamily as a group, there are no acquisition fees, and if you need to exit you can sell your stake to another member of the group. Multifamily is traditionally viewed as illiquid, but if you know what you're doing you can actually make it more liquid than SFRs. When you invest as a collaborative group, a collective of individuals supporting one another, the burden of due diligence is shared, operators get happy with the group because a single conversation thread reaches many people and so they bring good deals to the group, and the entire group gets liquidity where usually you would expect none. We have bought other investors out of multifamily stakes. It's not true that it is illiquid if you set things up right.
> SFR's allow a person choice of liquidation via revenue valuation OR retail O.O. valuation, you don't get that with MFH. Capitol costs are less, inventory is more available, less regulatory impact, more options for monetization, financing is simpler, accessing equity is simpler and more available, operation options are simpler and with greater control.
I invest in other people’s syndications. I’m not involved in the financing, I’m not sourcing equity, I’m not running the operation. When it comes to opportunities as a passive investor, there are a vast ocean of deals available. As mentioned you can liquidate a stake in a building under construction when you invest as a group in a syndication. Been there, done that. And the capital cost to buy a stake in a syndication can be significantly less than the capital cost to buy a single family home.
> Reality is for the vast majority who seek Cadillac $ not Lambo $, value simplicity, control, reliability and consistency, SFR's reign supreme, they do.
I drive a 2015 Hyundai Sonata. It’s beat up, and I love it. I will never own a Cadillac or a Lamborghini. That’s not what excites me. I like helping people grow. Way more exciting.
> MFH's is for scale, 100%. But as said, not everyone or even the majority want to scale, they simply don't.
I disagree that people on this forum don’t want to scale, they are just trying to work out how to do so. Why else would anyone spend time reading a post like this? I bought my first long-term rental in September 2020 and achieved financial freedom in May 2025, building out a multi tens of million dollar portfolio. My net worth after all lifestyle expenses increased by over $2.5 million in the last 12 months. I spend lots of times with my kids, and travel extensively. I’m generous with my time. If anyone reading this wants to learn how to do what I’ve done, they’re welcome to message me and I’ll happily explain it one-on-one. I share all I know and have built freely. No charge ever for anything. No secrets. Ask me anything.
> You certainly don’t need millions to participate in a syndication. Indeed, compared to buying a single-family rental in many markets, the entry price into a syndication can be significantly lower than the down payment required to buy a rental.
In some instances that is true, and in a great many of instances it's about the same $ investment. BUT, and it's a very big but; when a person uses their $ to purchase a property they are in direct control. In a syndication, their along for the ride. Next big but is, when acquire a property their empowered to multiply the income potential of their investment capital far more than in a syndication, as the leverage potentials are far greater. For example, if a persons does a very simplistic strategy of O.O. buy via a 10% down, live-in for 1yr, then buy another, move, lease out the previous unit. Or really any # of effective leverage strategies such as house hacking, BRRR, value-add etc etc..
> Raising even tiny amounts of money is highly educational, it forces you to analyze a deal properly, work out the likely return, keep your books properly, report results. There is a great deal of professionalism that comes with managing even a small amount of other people’s money.
That's an intriguing point.... I find the vast majority view such as added work, stress, responsibility and accountability unto others which translates to a loss of freedom and added risk. I like the forced edu aspect, I do, although I think your missing how strong the desire of independence is in most.
> I know how to start a managed fund with just $15k in legal fees that gives you the right to advertise publicly and raise up to $150 million. Chat GPT can’t teach you that.
$15k is exceptionally cheap for such. Although as both you and I know there is a lot more to it then just that baseline empowerment. The real struggles come in for most in operational management. And next in deal flow. These 2 factors are often a stopping point, because it's work, work that many do not desire to take on.
> "most don't care to scale" ----> I disagree. I’m not sure why you would even say that.
Because that is the reality from the front line, this is as I experience it.
The first a foremost service I provide investors of all kinds is as an advisor. Everyone starts with a consult, and I have a long list of investors of every kind, size and level from 0 too gigantic who utilize me as a sounding board, a consultant, to discuss, strategize, plan development, strategy review etc etc.. Just yesterday I spent an hour with an investor most would ask why such a wildly successful multi-millionaire would "need" advice and consulting. Because a very common theme of successful people is circling themselves with mentors and advisors, seeking review of ideas and concepts, they are knowledge miners.
So with that I talk with a lot of people on a regular basis, discussing goals and setting resource and desire fences.
And with that experience of hundreds upon hundreds, the vast majority, 92%+, express not only no desire to syndicate but also no desire to scale exponentially.
The prevailing desire is to achieve the desired financial ends, in the most expedient means possible, within their risk appetite, as simply as possible with least impact and intrusion into their active daily lives.
That simply is the prevailing majority of mindsets out there.
> ....10 to 20 rentals.... ....this is not a modest goal. Only a tiny fraction of people in the US can ever own so many rentals. 35% of households rent. The percent of people that can ever own 20 rentals is definitely less than 1%.
This is very incorrect information, and incorrect perception.
The US has been in process for some time now of the scale flipping from majority ownership too majority tenancy. As Clause announced to the world, and was actually the theme of the summit: "You will own nothing, and be HAPPY". The # consistently put out there for years now across various paradigms of groups has been a projection of 60% tenancy. It's been reiterated to such extent that one has to wonder if it isn't more-so a quota then a projection. Especially with fact that markets have been consistently moving more and more toward achieving this "quota".
As for ability to achieving such, my clients have a 98.5% chance of achieving it and I say that only because nothing is 100% in life other than tax's and death. The only question is not on ones ability to achieve it but if they will put in the work, follow the plan, execute on the steps required to achieve this end.
It is not a mysterious mythical impossible thing. It is a mathematical thing, very literally a math equation. The work I do is to assist people to develop their equation, from there is simply the work of doing the math.
Just like any business, it's all about methodology vs chance and randomness. Any who operate via chance and random actions will of course reap random results.
> I would argue that many people are actually quite careless with their own money.
Many do act financially careless, but that does not change how much they CARE for their money. Your comingling financial literacy with care, they are 2 very different things.
One could have the strongest of interest and passion in being a NASCAR driver, and when jump behind the wheel find their a horrific driver. Being a horrific driver does not mean they lack care and passion for it, it means they lack the skills and knowledge to properly execute on their care and passions.
And to their defense, the entire public USA system is designed to produce good little consumers, NOT investors or wealth. Consumerism is the status quo of USA. Wealth, independence and financial freedom is not the design for the masses and thus, of course financial neglect is the norm, it's what's literally taught and promoted popularly.
> The example you gave above of 10 to 20 rentals is not something most people can do.
Incorrect, the vast majority can achieve this rather low bar, the only question is what the path is for the specific person and will they execute on the actions to get them there.
The first step is universal, active income production to empower investible capitol. In this day and age a side-hustle is just far to simple for everyone to have one. There is no excuses to not take these active income steps. If one is unwilling then they are not serious about ever achieving the ends.
Next is appreciation. Appreciation is the #1 most important ingredient to growth. In what form and fashion this takes, again, is very person to the individual and get's detailed in their person development plan. Appreciation is paramount because via appreciation is how we can Pyramid.
This leads into the next key aspect, pyramiding. Pyramiding is how we can achieve infinite returns. Infinite returns is how we achieve rapid rates of growth.
There is many details to it all which again, various person to person as it's personal to their resources, natural empowerments and natural disadvantageous. The how can vary wildly but the general picture is the same; embrace natural advantageous and utilize them effectively, mitigate the weak points, appreciation to empower pyramiding, pyramiding to achieve infinite returns, infinite returns to grow assets under control, grow assets under control to achieve level of assets to then "flip the switch" too debt paydown via OPM, to achieve and end of certain level of passive income debt free.
It is a math game, plain n simple. With strategy to execute and best express the math.
And yes, if wondering, yes, I am "the" definitive strategist. Sun Tzu is my messiah.
> If you invest in multifamily as a group, there are no acquisition fees.
That is exceptionally false, and misleading at best if not patently fraudulent.
A MFH transaction has costs of transaction just like SFR's. Their is agency costs, legal facilitator costs, inspections, not to mention GP's fee's on top of it all, and so on and so fourth. Those costs are either seen and known, or encapsulated into whatever generalized price one is paying. There is no magic MFH leprechaun empowering a cost free transaction of real estate.
> I invest in other people’s syndications. ....I’m not running the operation.
For a large majority of people, that is a giant risk position, it's fearful and uncomfortable to have such loss of control. And there is a great number of stories speaking of the risks come to pass, and the substantial loss of $ from such horrors realized.
It is all great and fun, until it isn't, and then it's a living nightmare.
> I like helping people grow. Way more exciting.
And i applaud you for that. Sad truth is, it's not universal, and all too many in the syndication space hold very different motives and focuses, ones not aligned to the best interest's of the LP's. It is very much so a world of LP's can make $ if and when GP's do, and if GP's don't, oh-well, sorry for your loss LP's, and onto the next....
> I disagree that people on this forum don’t want to scale, they are just trying to work out how to do so. Why else would anyone spend time reading a post like this?
Because they want to profit. The vast majority are seeking out how-to, but don't want to put in the work for the how-to, so they keep looking around, seeking their "Golden Ticket" because of some belief that there is some easy, simple, risk free thing out there and that is how "those" people got rich. The have-not's hold a popular sentiment that the have's got to where they are via some hidden secret, access to something, a knowing of something, a connection, tip, trick or hack.
The secret is, there is no secret.
Somewhere out their is someone who's wildly wealthy via urinal cakes.... Another via running a boring manufacturing plant making paper straws.
Wealth is all around us all the time, literally millions upon millions around this world achieving it coming from nothing. That is the majority, the minority inherit.
And a prevailing story is of putting in the work, over time, methodically, consistently.
One has to first choose to be wealthy, second accept to put in the time and the work to walk-the-walk, and third SHOW-UP day after day after week after month after year after year.
Wealth is a RESULT, not a thing in and of itself.
Add 1, to 1, and you will get 2. If one set's to their equation, does the actions of addition, the results are inevitable.
Syndications are and always will be risky because one is putting their financial future in the hands of others, they are relinquishing control. That is a fearful thing for many, and rightfully so.
Does it mean syndications are bad? No. They are what they are.
Syndications are right for some and not for most. Why not for most? Because a very common thread of those seeking or living as REI's is a passion for FREEDOM. FREEEEEEE-DOM! It's the spirit that literally forged this nation.
And the dependency that is a feature of syndications, is an impediment on this spirit of freedom.
Go back a few hundred years and many of us would be the same people jumping on a ship to cross uncharted waters to craft unknown lives. It less a passion for the currency and more a passion for the LIFE of self actuation. A life of choice, unhindered by the necessity to do ___ to pay ___ so we can live ____. Financial freedom means life freedom, freedom of self, liberation from the shackles of j.o.b's.
If money stopped existing, what would you be doing? Everything, every resource in such plentiful that $ no longer exist.....
That's the true deep desire of most seeking financial freedom, it's not about the financial as much as it is about freedom. And hence scaling is just not an interest for most, not nearly as much as simplicity and expediency to get too freedom.
More is not more for many of us, it's just more......
Hi James,
> when a person uses their $ to purchase a property they are in direct control. In a syndication, their along for the ride.
I do not wish to be in control of the asset. I have a PhD in physics. I spent the last 20 years working in quantum computing. There are other people that have spent the last 20 years working in real estate, building companies with dozens or hundreds of employees. I want *those* people to be in control of my real estate assets, not me. People that know real estate better than I do and ever will. Take Urban Genesis for example (https://urban-genesis.com/), this is run by a guy that makes his living building multi-hundred unit multifamily apartment complexes. He manages an over billion-dollar portfolio of carefully located and designed individual assets. A vertically integrated construction company. I am never going to be that guy. I don’t want to be that guy. But I do want *that* guy to manage a syndication I participate in.
> Next big but is, when acquire a property their empowered to multiply the income potential of their investment capital far more than in a syndication, as the leverage potentials are far greater. For example, if a persons does a very simplistic strategy of O.O. buy via a 10% down, live-in for 1yr, then buy another, move, lease out the previous unit. Or really any # of effective leverage strategies such as house hacking, BRRR, value-add etc etc..
You can leverage into a syndication. All the way to 100% if you wish. You can make the return on your $0 invested technically infinite if you wish. I wish to do so and that is what I do routinely.
>> Raising even tiny amounts of money is highly educational, it forces you to analyze a deal properly, work out the likely return, keep your books properly, report results. There is a great deal of professionalism that comes with managing even a small amount of other people’s money.
> That's an intriguing point.... I find the vast majority view such as added work, stress, responsibility and accountability unto others which translates to a loss of freedom and added risk. I like the forced edu aspect, I do, although I think your missing how strong the desire of independence is in most.
If you raise $100 from someone, you are on the hook for $100 + very little after a year. You can make the stress, responsibility, and accountability, as low as you wish while you are learning. The work can be precisely 0. I use free tools that take care of all transactions, monthly statements, annual statements, tax documents, everything.
Bigger Pockets is a community. If you want independence, why be here at all? Investing independently is objectively a terrible idea. If you can get feedback from a whole community on an investment decision you are about to make, that’s a wonderful thing. It helps educate others and helps keep you safe.
>> I know how to start a managed fund with just $15k in legal fees that gives you the right to advertise publicly and raise up to $150 million. Chat GPT can’t teach you that.
> $15k is exceptionally cheap for such. Although as both you and I know there is a lot more to it then just that baseline empowerment. The real struggles come in for most in operational management.
There is no struggle when it comes to operational management as there are free tools that take care of all of this for you.
> And next in deal flow. These 2 factors are often a stopping point, because it's work, work that many do not desire to take on.
I run a forum where we share interesting deals that we are finding and do group due diligence on them. There is more than enough deal flow for everyone. Particularly in passive multifamily. There is enough deal flow to deploy hundreds of millions of dollars a month if you really wanted to.
>> "most don't care to scale" ----> I disagree. I’m not sure why you would even say that.
> Because that is the reality from the front line, this is as I experience it.
I am personally surrounded by people that want to grow. Want to scale. Perhaps I actively seek out people with a growth mindset that want to scale and that is my lived experience.
> And with that experience of hundreds upon hundreds, the vast majority, 92%+, express not only no desire to syndicate but also no desire to scale exponentially.
I also have hundreds of clients. I don’t think there is any shortage of people that wish to grow exponentially. And I stress that I do not do syndications. I have never raised capital for a specific asset as equity.
> The prevailing desire is to achieve the desired financial ends, in the most expedient means possible, within their risk appetite, as simply as possible with least impact and intrusion into their active daily lives.
Agreed. Simplicity is key, and what I focus on. Passive multifamily with the most professional operators, and OPM using free automated tools to keep the operation simple. And cash, stocks, SF LTRs, renewable energy, and flips for diversity :-)
>> ....10 to 20 rentals.... ....this is not a modest goal. Only a tiny fraction of people in the US can ever own so many rentals. 35% of households rent. The percent of people that can ever own 20 rentals is definitely less than 1%.
> This is very incorrect information, and incorrect perception.
It’s just math. A majority of households cannot even own their own home plus 1 rental household, since this would already be 100% of households. 50% of households owning two homes, 50% owning none. At 20 rentals, 21 properties total, the market is fully owned with less than 5% of people participating in property ownership, the other 95%+ being forced to rent. Financial freedom through owning dozens of homes is mathematically guaranteed to be a technique that can only be pursued to fruition by a tiny number of people.
> The first step is universal, active income production to empower investible capitol.
It’s not the only way, you can also pursue financial education and capital raising. After 10 years at university, I had to travel to Canada to pursue my trade in quantum computing. A trade that paid me just $50k Canadian a year. I would’ve made more money quicker learning to be a plumber in Australia. But I love what I do, and so I learned how to invest and raise capital while I was still a student. You do not have to focus on personal income when it comes to investing.
> This leads into the next key aspect, pyramiding. Pyramiding is how we can achieve infinite returns. Infinite returns is how we achieve rapid rates of growth.
Can you give an example of infinite returns from your own experience? As mentioned, raising all of the capital for a deal is one way you can get infinite returns, but I am curious as to what you focus on.
>> If you invest in multifamily as a group, there are no acquisition fees.
> That is exceptionally false, and misleading at best if not patently fraudulent.
> A MFH transaction has costs of transaction just like SFR's. Their is agency costs, legal facilitator costs, inspections, not to mention GP's fee's on top of it all, and so on and so fourth. Those costs are either seen and known, or encapsulated into whatever generalized price one is paying. There is no magic MFH leprechaun empowering a cost free transaction of real estate.
I’m speaking from experience here. Yes, the deal bears all those above costs. But when an investor that has allocated capital into a deal wishes to exit a deal, they can sell their stake to another investor wishing to enter that deal, and that is a transaction that can have no transaction fees. No BS, been there done that. It does require having a relationship with the operator, as not every operator will allow this, but it can be done.
>> I invest in other people’s syndications. ....I’m not running the operation.
> For a large majority of people, that is a giant risk position, it's fearful and uncomfortable to have such loss of control. And there is a great number of stories speaking of the risks come to pass, and the substantial loss of $ from such horrors realized.
See above, if you are entering into a syndication, you should be partnering with someone that is far, far better than you are at real estate. As such, being hands-off reduces the risk because you are very specifically not the one calling the shots.
>> I like helping people grow. Way more exciting.
> And i applaud you for that. Sad truth is, it's not universal, and all too many in the syndication space hold very different motives and focuses, ones not aligned to the best interest's of the LP's. It is very much so a world of LP's can make $ if and when GP's do, and if GP's don't, oh-well, sorry for your loss LP's, and onto the next....
I only work with large public operators with a published track record that they do not wish to tarnish. Such an operator faces serious consequences if they must add a failure to their track record. In the case of Urban Genesis, for example, they have taken approximately 15 buildings full cycle over 10 years with an average investor return of over 20% per annum, and no losses. Their deals are incredibly conservatively underwritten. For example, their worst deal, which led to just a 2% IRR for investors, occurred when they built a building that completed during Covid with the exception of a transformer that supply chain issues meant could not be obtained for a *year*. A fully complete building with the exception of power lay vacant and idle on construction finance for a year before they were able to begin leasing it up, and investors still didn't suffer a loss. There are incredible operations out there, and my goal as an investor is to only partner with the incredible. Another one of the operators I have worked with has been in business for 120 years. I don't work with people just starting out.
>> I disagree that people on this forum don’t want to scale, they are just trying to work out how to do so. Why else would anyone spend time reading a post like this?
> Because they want to profit. The vast majority are seeking out how-to, but don't want to put in the work for the how-to, so they keep looking around, seeking their "Golden Ticket" because of some belief that there is some easy, simple, risk free thing out there and that is how "those" people got rich. The have-not's hold a popular sentiment that the have's got to where they are via some hidden secret, access to something, a knowing of something, a connection, tip, trick or hack.
I don’t know James, I wouldn’t talk about people on this forum like that. In my experience, armed with knowledge, everyone wants to scale. The only exception being people that are already financially free and happy with their lifestyle.
> The secret is, there is no secret.
Well, I think there are certainly things that most people don’t know, but I agree there should not be secrets.
> Syndications are and always will be risky because one is putting their financial future in the hands of others, they are relinquishing control. That is a fearful thing for many, and rightfully so.
Do you invest in syndications? I do not think most people should try to build a multi-hundred unit apartment complex and lease it up. This is something for people with decades of experience. You should definitely relinquish control when investing in a deal like this. It is not right to be fearful to relinquish control to someone that knows more than you. It should be comforting.
> Syndications are right for some and not for most. Why not for most? Because a very common thread of those seeking or living as REI's is a passion for FREEDOM. FREEEEEEE-DOM! It's the spirit that literally forged this nation.
While syndications are definitely not all I do, they are definitely a very big part of my financial freedom. It’s not clear to me why you arguing that a syndication isn’t a very good way to be free. The comfort of knowing that you are partnering with someone far better at real estate than yourself. In my mind, an attitude of "I must do everything myself" would be a terrible straitjacket, and an enormous barrier to achieve true freedom. In my mind delegation is the key to freedom.
- Real Estate Broker · Minneapolis, MN · Member since 2011 · 5k+ posts · 6k+ votes1y
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Take $20M, pick up 50 single-family homes at ~$400k each. Rent them at $3k, net about $2k per door. That’s $100k/month in cash flow, plus appreciation. Low-maintenance properties, low-drama tenants, simple portfolio. It’s not flashy, but it’s clean, seats enough to self mange (for the REPS tax benefits), and lets you live well without headaches
$3k at $400k is hard, but possible. Have some higher, some lower, but mainly higher. You'll still have tenant issues, maintenance, etc. To think it'll be all roses is just naive. Fortunately have PMs, AI agents, etc.
With $10 mil continue to be focused on properties in Austin, and Phoenix. Doesn't change for me on the personal portfolio.
$1mil folks worry about protecting their wealth. $10mil folks focus on growing their wealth. But to get to the latter, you usually have to go through the former. Majority of this board shouldn't be focused on this problem though. Think it's just to sniff out potential investors for OPs fund.Hi V.G., the goal is to encourage actual real estate experts, actual people that operate at this scale, to share techniques that work at this scale and help educate people to head in that direction as well. If you anyone wants to operate at this scale, they need to focus on learning techniques that work at this scale. When it comes to building wealth, you can waste decades of your life learning labor intensive techniques and building a portfolio that simply doesn't scale.
I "operate" with more "scale" than 99% of BP.
And I'm telling you 99% needs to stop being obsessed with scale. And start being obsessed with diligence.You're getting it right from the horse's mouth, yet still want to push this point. It's missing the forest for the trees. You're trying to scale by acquiring outside capital, I get it. Go do that in a proper form.
Totally agree with a need for everyone to be obsessed with due diligence. For example, when I acquire an asset, it is a month+ long process involving hundreds of people doing group due diligence trying to find holes in the deal and learning more about it before anyone invests. It's an approach anyone can use. I disagree with the philosophy that there are some special people that use special techniques that are amazing and can't even be explained, and then a majority of average people that should stick with average techniques that don't scale. There are good investment techniques that anyone can use that are scalable. One example of such a technique is doing extensive group due diligence on passive multifamily. Another is simply cash or an index fund, neither of which chew up your time and scale arbitrarily. This thread is all about identifying scalable techniques that anyone can use. Or just interesting techniques that people have used at scale. Working together as a community to educate each other.
Scalability is easily and readily available for the vast majority, scalability is not the issue for most.
The issue for most is how limited their investment capitol is, the massive return expectations being sought, over an exceptionally short time-span.
Many seeking parabolic, unrealistic, compounding returns. Which are not really returns, as so many are actually seeking full income replacement via the "investing".
To boot, adding in the riders of things such as "passive", "low risk" and "certain"......
To be fair Austin, you as a syndicator are hacking the scalability via syndication, O.P.M.. Most are not capable, willing or interested in raising O.P.M. to scale and thus a natural limiter of there investible capitol.
Remove your LP capitol, you would not be at the size you are, correct? No syndicator would. So it's not fair to pretend it's the deals that make scalability alone. It is possible but it is very rare, exceptional and non-ordinary for such.
For the vast majority who are measuring their investible capitol in the tens of thousands, while balancing a FT career, a family, life in general, yes it is rare skills and talents to find, analyze and execute on profitable investments at any kind of regularized interval. And in those early steps, the outlay of capitol far outstrips the returns for years or decades limiting any reasonable expectation of scalability.
In my experience the primary focus for most is not on scalability but on certainty to achieve financial freedom. Which is often defined as a passive income about matching to current active income levels.
For most the only scalability that matters is how to get to their ends. I often see a correlation that this is meet for most between 20-40 SFR's.
For many, scaling beyond that is just added work, and no longer "freedom" as was the entire intent from start, financial freedom, not an occupation change.
Hi V.G.,
> Scalability is easily and readily available for the vast majority, scalability is not the issue for most.
When it comes to scalability, I set the bar high. I want to be able to handle a very great deal of capital deployed in a lot of assets while basically on holiday. Using this perspective, to my eyes many people spend a great deal of time working real estate investing techniques that are not scalable. Passive multifamily is the most scalable technique I currently use, and I could use my exact due diligence process to easily handle $100M without changing how I operate. Just bigger checks into the deals I find.
> In my case, The issue for most is how limited their investment capitol is, the massive return expectations being sought, over an exceptionally short time-span.
So how about we focus on discussing how to solve capital limitations in a way that is doable by anyone?
> Many seeking parabolic, unrealistic, compounding returns. Which are not really returns, as so many are actually seeking full income replacement via the "investing".
I don’t work a W-2 anymore. My investing covers all of my expenses and was sufficient to add $2.5M to my net worth over the last 12 months. Full income replacement is definitely achievable.
> To boot, adding in the riders of things such as "passive", "low risk" and "certain"......
> To be fair Austin, you as a syndicator are hacking the scalability via syndication, O.P.M..
I don’t run syndications. I do invest in other people syndications. I have no desire to be a GP on a multifamily syndication with all of the responsibilities and duties that come with it.
> Most are not capable, willing or interested in raising O.P.M. to scale and thus a natural limiter of there investible capitol.
Here I disagree. I think most people just don’t know how to go about it. I have helped hundreds of people learn how to raise capital for their own investing. I have helped quite a number of people start their own SEC registered managed funds. And there is an awful lot you can do with a lot less than this. It’s knowledge that people need.
> Remove your LP capitol, you would not be at the size you are, correct?
Correct.
> No syndicator would. So it's not fair to pretend it's the deals that make scalability alone.
The multifamily deals I focus on are not mine, and from a return point of view are nothing off the charts, the general target is around 20% per annum. And no, it’s not the deal that gets you to huge scale, it is definitely learning how to raise capital. And that is something anyone can learn, and the only way to get to great wealth in a lifetime.
> It is possible but it is very rare, exceptional and non-ordinary for such.
Agreed it is not about the deal, it is about learning how to access capital efficiently. And that is a teachable skill.
> For the vast majority who are measuring their investible capitol in the tens of thousands, while balancing a FT career, a family, life in general, yes it is rare skills and talents to find, analyze and execute on profitable investments at any kind of regularized interval. And in those early steps, the outlay of capitol far outstrips the returns for years or decades limiting any reasonable expectation of scalability.
So you share the load. You don’t try to do all of the deal due diligence yourself. You do it in a group where some (even most) people can even passively ride on the due diligence of others. You don’t try to reinvent the wheel when it comes to learning how to raise capital, you leverage free tools that already exist.
> In my experience the primary focus for most is not on scalability but on certainty to achieve financial freedom. Which is often defined as a passive income about matching to current active income levels.
Financial freedom requires passive investments at scale. Speaking from experience.
> For most the only scalability that matters is how to get to their ends. I often see a correlation that this is meet for most between 20-40 SFR's.
I would argue that self managing so many single-family rentals is a burden. I’m in that range with managed rentals, and I would say that this is definitely not enough for the level of financial freedom I wish to have, even if they were all paid off, which they aren’t.
> For many, scaling beyond that is just added work, and no longer "freedom" as was the entire intent from start, financial freedom, not an occupation change.
Agreed, but to say the same thing a different way, there are more profitable and more passive investments than single-family long-term rentals.
"....I want to be able to handle a very great deal of capital deployed in a lot of assets while basically on holiday.... Passive multifamily is the most scalable...., ....I could use my exact due diligence process to easily handle $100M without changing how I operate....."
To that end, as a person who's worked in this segment, I agree 100%, community level MFH is the simplest most passive means to effectively be invested in real estate at significant $ levels.
But that is the rub, it's a ~$40m+ "pay-to-play" game. That is a level that an exceptional small % of landlords acheive, or even have a desire to ever achieve. I used to work in private equity, I had 9 and even a few 10 figure clients, I know it's attainable, and how rare that ambition of scale is. Just because you possess it, does not mean it's shared by a majority.
"So how about we focus on discussing how to solve capital limitations in a way that is doable by anyone?"
In the sage wisdom of Ratatouille; anyone can cook, but not everyone can be great.
For those who want to, they can, OPM, it's just that simple and really there is no other way around it, it's just the reality of the math of things. Or they need to be hyper active in it to be able to achieve the parabolic returns from strategies that get to infinite returns in rapid order, ie not passive at all.
The issue is not inability, it's desire. I stepped down from the world of private equity on purpose to work with "average" John & Jane Doe's, from wall street too main street, sacrificing profit for passion of purpose. I have seen the stark difference first hand, the vast majority simply do not desire to achieve "yacht $". Their goals are much more humble and focused toward simplicity.
"....I think most people just don’t know how to go about it. I have helped hundreds of people learn how to raise capital for their own investing. ....It’s knowledge that people need."
For some, very true. Although in this day and age, access to information is so available and so simple, there really is no barriers anymore. Via ai one doesn't even need to put much effort into seaking out the info, one can literally talk to the GPT of choice, for free, and get answers, direction, action items, really everything needed. So again, were back to interest not access being the primary issue.
"....no, it’s not the deal that gets you to huge scale, it is definitely learning how to raise capital. And that is something anyone can learn, and the only way to get to great wealth in a lifetime."
Yes, as I said scalability is readily available.... for those who want it, but that's the point, most don't care to scale, they don't, they want a certain passive income as simply, safely, and quickly as possible.
As for scale being the "only way to get to great wealth", I couldn't disagree more. yes, it is a way, but not the only way. Not to mention "great wealth" is a perceptual thing, for one that may be $100m, another it may be $1b, and for another it may be $50k a year.
I find many "main street" investors consider their "wealth" at $10kmnth inflation adjusted passive income, and the vast majority consider $20k mnth passive income "Great wealth". In the market's I play in, that's readily acheive with less than 10 free & clear SFR's. Or 20 moderately leveraged SFR's. Add in 15% - 20% for security buffer, that's a small, simple, easily managed portfolio that provides flexibility (ie options and control) on how one chooses to run their portfolio and life.
Again, massive scale is not of interest for everyone, or even most.
"So you share the load. You don’t try to do all of the deal due diligence yourself. You do it in a group...."
Nobody ever cares about your $, like you do; this is the credo of main-street investors. Not to mention the loss of control, the dependency of not being self-capable. That equals fear for most on main street, not safety or security. This is antigen to the pursuit of financial FREEDOM, freedom is independence.
"Financial freedom requires passive investments at scale."
Again, strongly disagree. I know of a great many who have acheived financial freedom without significant scale. Again, financial freedom is a perceptual thing that is different and personal person to person. The scale to meet that bar will vary person 2 person, and most are rather humble bars to meet.
"I would argue that self managing so many single-family rentals is a burden."
Well, it can be, it depends on the person, there abilaties, and how savy they are to get professionals when and where one is needed to hire their problems away. Those who do that, can find it very very simple. My best average was managing 184 properties in 7hrs a week, measured over a quarter. Me, as in me, personally actively managing them, not my PM's. So it's doable. I spent 8 months building out the systems and structure to get there but point is, 20-40 is very reasonable to manage in a number of simple ways.
"there are more profitable and more passive investments than single-family long-term rentals."
I disagree, and I have the math to back me up. MFH is not nearly as liquid as SFR's. SFR's allow a person choice of liquidation via revenue valuation OR retail O.O. valuation, you don't get that with MFH. Capitol costs are less, inventory is more available, less regulatory impact, more options for monetization, financing is simpler, accessing equity is simpler and more available, operation options are simpler and with greater control.
Reality is for the vast majority who seek Cadillac $ not Lambo $, value simplicity, control, reliability and consistency, SFR's reign supreme, they do.
MFH's is for scale, 100%. But as said, not everyone or even the majority want to scale, they simply don't.
Hi James,
> Community level MFH is the simplest most passive means to effectively be invested in real estate at significant $ levels. But that is the rub, it's a ~$40m+ "pay-to-play" game.
You can participate in a syndication for a minimum investment typically in the $25k to $100k range. You certainly don’t need millions to participate in a syndication. Indeed, compared to buying a single-family rental in many markets, the entry price into a syndication can be significantly lower than the down payment required to buy a rental.
> I have seen the stark difference first hand, the vast majority simply do not desire to achieve "yacht $". Their goals are much more humble and focused toward simplicity.
I’m not interested in yachts, but I do know how to teach someone how to raise capital without it taking significant time. You can start with your own kids or siblings, raise tiny amounts of money. Raising even tiny amounts of money is highly educational, it forces you to analyze a deal properly, work out the likely return, keep your books properly, report results. There is a great deal of professionalism that comes with managing even a small amount of other people’s money.
> access to information is so available and so simple, there really is no barriers anymore. Via ai one doesn't even need to put much effort into seaking out the info, one can literally talk to the GPT of choice, for free, and get answers, direction, action items, really everything needed. So again, were back to interest not access being the primary issue.
Most people don’t know what is possible. They don’t know what questions to ask. The wonderful thing about bigger pockets as you get exposed to people doing things you didn’t know were possible. The goal is for everyone to network and for the community to inspire everyone to do more than they thought could be done. I know how to start a managed fund with just $15k in legal fees that gives you the right to advertise publicly and raise up to $150 million. Chat GPT can’t teach you that --- I just asked it and it said it wasn’t possible :-)
> most don't care to scale
I disagree. I’m not sure why you would even say that. While there might be some people that are content where they are and do not wish to scale, I would suspect that the vast majority of people spending time on bigger pockets are looking for ways to grow. Anyone with a growth mindset is always looking for ways to grow.
> I find many "main street" investors consider their "wealth" at $10kmnth inflation adjusted passive income, and the vast majority consider $20k mnth passive income "Great wealth". In the market's I play in, that's readily acheive with less than 10 free & clear SFR's. Or 20 moderately leveraged SFR's. Add in 15% - 20% for security buffer, that's a small, simple, easily managed portfolio that provides flexibility (ie options and control) on how one chooses to run their portfolio and life.
Getting to 10 to 20 rentals definitely meets my definition of scaling. Particularly if they are significantly paid off. Note that this is not a modest goal. Only a tiny fraction of people in the US can ever own so many rentals. 35% of households rent. Most investors with rentals have only a handful. The percent of people that can ever own 20 rentals is definitely less than 1%.
> Nobody ever cares about your $, like you do; this is the credo of main-street investors.
I would argue that many people are actually quite careless with their own money. They see something interesting, and don’t do enough due diligence, and allocate capital to it. When you do due diligence in a group, people in the group try to shoot down presented deals, and it forces people to be more thorough and careful in their analysis.
> Not to mention the loss of control, the dependency of not being self-capable.
Multifamily syndication deals are complex, many moving parts, lots of things to check. It is definitely not an advantage to try to analyze one on your own.
> I know of a great many who have acheived financial freedom without significant scale.
Can you be more specific? The example you gave above of 10 to 20 rentals is not something most people can do. The math of how many owners there are to renters doesn’t enable many people to own that much property.
> 20-40 is very reasonable to manage in a number of simple ways.
Yes, but not a reasonable target for the vast majority of people. At 40 properties you really are looking at maybe 0.1% of the population or less that can mathematically hold so many properties. Every such owner must have 40 households of tenants. I like being involved in ground-up development because there are so many things that need to be built. So many opportunities to deploy capital to do good and expand the supply of housing.
> MFH is not nearly as liquid as SFR's.
For most people, selling a SFR takes significant time with significant fees. As does buying one. If you invest in multifamily as a group, there are no acquisition fees, and if you need to exit you can sell your stake to another member of the group. Multifamily is traditionally viewed as illiquid, but if you know what you're doing you can actually make it more liquid than SFRs. When you invest as a collaborative group, a collective of individuals supporting one another, the burden of due diligence is shared, operators get happy with the group because a single conversation thread reaches many people and so they bring good deals to the group, and the entire group gets liquidity where usually you would expect none. We have bought other investors out of multifamily stakes. It's not true that it is illiquid if you set things up right.
> SFR's allow a person choice of liquidation via revenue valuation OR retail O.O. valuation, you don't get that with MFH. Capitol costs are less, inventory is more available, less regulatory impact, more options for monetization, financing is simpler, accessing equity is simpler and more available, operation options are simpler and with greater control.
I invest in other people’s syndications. I’m not involved in the financing, I’m not sourcing equity, I’m not running the operation. When it comes to opportunities as a passive investor, there are a vast ocean of deals available. As mentioned you can liquidate a stake in a building under construction when you invest as a group in a syndication. Been there, done that. And the capital cost to buy a stake in a syndication can be significantly less than the capital cost to buy a single family home.
> Reality is for the vast majority who seek Cadillac $ not Lambo $, value simplicity, control, reliability and consistency, SFR's reign supreme, they do.
I drive a 2015 Hyundai Sonata. It’s beat up, and I love it. I will never own a Cadillac or a Lamborghini. That’s not what excites me. I like helping people grow. Way more exciting.
> MFH's is for scale, 100%. But as said, not everyone or even the majority want to scale, they simply don't.
I disagree that people on this forum don’t want to scale, they are just trying to work out how to do so. Why else would anyone spend time reading a post like this? I bought my first long-term rental in September 2020 and achieved financial freedom in May 2025, building out a multi tens of million dollar portfolio. My net worth after all lifestyle expenses increased by over $2.5 million in the last 12 months. I spend lots of times with my kids, and travel extensively. I’m generous with my time. If anyone reading this wants to learn how to do what I’ve done, they’re welcome to message me and I’ll happily explain it one-on-one. I share all I know and have built freely. No charge ever for anything. No secrets. Ask me anything.
> You certainly don’t need millions to participate in a syndication. Indeed, compared to buying a single-family rental in many markets, the entry price into a syndication can be significantly lower than the down payment required to buy a rental.
In some instances that is true, and in a great many of instances it's about the same $ investment. BUT, and it's a very big but; when a person uses their $ to purchase a property they are in direct control. In a syndication, their along for the ride. Next big but is, when acquire a property their empowered to multiply the income potential of their investment capital far more than in a syndication, as the leverage potentials are far greater. For example, if a persons does a very simplistic strategy of O.O. buy via a 10% down, live-in for 1yr, then buy another, move, lease out the previous unit. Or really any # of effective leverage strategies such as house hacking, BRRR, value-add etc etc..
> Raising even tiny amounts of money is highly educational, it forces you to analyze a deal properly, work out the likely return, keep your books properly, report results. There is a great deal of professionalism that comes with managing even a small amount of other people’s money.
That's an intriguing point.... I find the vast majority view such as added work, stress, responsibility and accountability unto others which translates to a loss of freedom and added risk. I like the forced edu aspect, I do, although I think your missing how strong the desire of independence is in most.
> I know how to start a managed fund with just $15k in legal fees that gives you the right to advertise publicly and raise up to $150 million. Chat GPT can’t teach you that.
$15k is exceptionally cheap for such. Although as both you and I know there is a lot more to it then just that baseline empowerment. The real struggles come in for most in operational management. And next in deal flow. These 2 factors are often a stopping point, because it's work, work that many do not desire to take on.
> "most don't care to scale" ----> I disagree. I’m not sure why you would even say that.
Because that is the reality from the front line, this is as I experience it.
The first a foremost service I provide investors of all kinds is as an advisor. Everyone starts with a consult, and I have a long list of investors of every kind, size and level from 0 too gigantic who utilize me as a sounding board, a consultant, to discuss, strategize, plan development, strategy review etc etc.. Just yesterday I spent an hour with an investor most would ask why such a wildly successful multi-millionaire would "need" advice and consulting. Because a very common theme of successful people is circling themselves with mentors and advisors, seeking review of ideas and concepts, they are knowledge miners.
So with that I talk with a lot of people on a regular basis, discussing goals and setting resource and desire fences.
And with that experience of hundreds upon hundreds, the vast majority, 92%+, express not only no desire to syndicate but also no desire to scale exponentially.
The prevailing desire is to achieve the desired financial ends, in the most expedient means possible, within their risk appetite, as simply as possible with least impact and intrusion into their active daily lives.
That simply is the prevailing majority of mindsets out there.
> ....10 to 20 rentals.... ....this is not a modest goal. Only a tiny fraction of people in the US can ever own so many rentals. 35% of households rent. The percent of people that can ever own 20 rentals is definitely less than 1%.
This is very incorrect information, and incorrect perception.
The US has been in process for some time now of the scale flipping from majority ownership too majority tenancy. As Clause announced to the world, and was actually the theme of the summit: "You will own nothing, and be HAPPY". The # consistently put out there for years now across various paradigms of groups has been a projection of 60% tenancy. It's been reiterated to such extent that one has to wonder if it isn't more-so a quota then a projection. Especially with fact that markets have been consistently moving more and more toward achieving this "quota".
As for ability to achieving such, my clients have a 98.5% chance of achieving it and I say that only because nothing is 100% in life other than tax's and death. The only question is not on ones ability to achieve it but if they will put in the work, follow the plan, execute on the steps required to achieve this end.
It is not a mysterious mythical impossible thing. It is a mathematical thing, very literally a math equation. The work I do is to assist people to develop their equation, from there is simply the work of doing the math.
Just like any business, it's all about methodology vs chance and randomness. Any who operate via chance and random actions will of course reap random results.
> I would argue that many people are actually quite careless with their own money.
Many do act financially careless, but that does not change how much they CARE for their money. Your comingling financial literacy with care, they are 2 very different things.
One could have the strongest of interest and passion in being a NASCAR driver, and when jump behind the wheel find their a horrific driver. Being a horrific driver does not mean they lack care and passion for it, it means they lack the skills and knowledge to properly execute on their care and passions.
And to their defense, the entire public USA system is designed to produce good little consumers, NOT investors or wealth. Consumerism is the status quo of USA. Wealth, independence and financial freedom is not the design for the masses and thus, of course financial neglect is the norm, it's what's literally taught and promoted popularly.
> The example you gave above of 10 to 20 rentals is not something most people can do.
Incorrect, the vast majority can achieve this rather low bar, the only question is what the path is for the specific person and will they execute on the actions to get them there.
The first step is universal, active income production to empower investible capitol. In this day and age a side-hustle is just far to simple for everyone to have one. There is no excuses to not take these active income steps. If one is unwilling then they are not serious about ever achieving the ends.
Next is appreciation. Appreciation is the #1 most important ingredient to growth. In what form and fashion this takes, again, is very person to the individual and get's detailed in their person development plan. Appreciation is paramount because via appreciation is how we can Pyramid.
This leads into the next key aspect, pyramiding. Pyramiding is how we can achieve infinite returns. Infinite returns is how we achieve rapid rates of growth.
There is many details to it all which again, various person to person as it's personal to their resources, natural empowerments and natural disadvantageous. The how can vary wildly but the general picture is the same; embrace natural advantageous and utilize them effectively, mitigate the weak points, appreciation to empower pyramiding, pyramiding to achieve infinite returns, infinite returns to grow assets under control, grow assets under control to achieve level of assets to then "flip the switch" too debt paydown via OPM, to achieve and end of certain level of passive income debt free.
It is a math game, plain n simple. With strategy to execute and best express the math.
And yes, if wondering, yes, I am "the" definitive strategist. Sun Tzu is my messiah.
> If you invest in multifamily as a group, there are no acquisition fees.
That is exceptionally false, and misleading at best if not patently fraudulent.
A MFH transaction has costs of transaction just like SFR's. Their is agency costs, legal facilitator costs, inspections, not to mention GP's fee's on top of it all, and so on and so fourth. Those costs are either seen and known, or encapsulated into whatever generalized price one is paying. There is no magic MFH leprechaun empowering a cost free transaction of real estate.
> I invest in other people’s syndications. ....I’m not running the operation.
For a large majority of people, that is a giant risk position, it's fearful and uncomfortable to have such loss of control. And there is a great number of stories speaking of the risks come to pass, and the substantial loss of $ from such horrors realized.
It is all great and fun, until it isn't, and then it's a living nightmare.
> I like helping people grow. Way more exciting.
And i applaud you for that. Sad truth is, it's not universal, and all too many in the syndication space hold very different motives and focuses, ones not aligned to the best interest's of the LP's. It is very much so a world of LP's can make $ if and when GP's do, and if GP's don't, oh-well, sorry for your loss LP's, and onto the next....
> I disagree that people on this forum don’t want to scale, they are just trying to work out how to do so. Why else would anyone spend time reading a post like this?
Because they want to profit. The vast majority are seeking out how-to, but don't want to put in the work for the how-to, so they keep looking around, seeking their "Golden Ticket" because of some belief that there is some easy, simple, risk free thing out there and that is how "those" people got rich. The have-not's hold a popular sentiment that the have's got to where they are via some hidden secret, access to something, a knowing of something, a connection, tip, trick or hack.
The secret is, there is no secret.
Somewhere out their is someone who's wildly wealthy via urinal cakes.... Another via running a boring manufacturing plant making paper straws.
Wealth is all around us all the time, literally millions upon millions around this world achieving it coming from nothing. That is the majority, the minority inherit.
And a prevailing story is of putting in the work, over time, methodically, consistently.
One has to first choose to be wealthy, second accept to put in the time and the work to walk-the-walk, and third SHOW-UP day after day after week after month after year after year.
Wealth is a RESULT, not a thing in and of itself.
Add 1, to 1, and you will get 2. If one set's to their equation, does the actions of addition, the results are inevitable.
Syndications are and always will be risky because one is putting their financial future in the hands of others, they are relinquishing control. That is a fearful thing for many, and rightfully so.
Does it mean syndications are bad? No. They are what they are.
Syndications are right for some and not for most. Why not for most? Because a very common thread of those seeking or living as REI's is a passion for FREEDOM. FREEEEEEE-DOM! It's the spirit that literally forged this nation.
And the dependency that is a feature of syndications, is an impediment on this spirit of freedom.
Go back a few hundred years and many of us would be the same people jumping on a ship to cross uncharted waters to craft unknown lives. It less a passion for the currency and more a passion for the LIFE of self actuation. A life of choice, unhindered by the necessity to do ___ to pay ___ so we can live ____. Financial freedom means life freedom, freedom of self, liberation from the shackles of j.o.b's.
If money stopped existing, what would you be doing? Everything, every resource in such plentiful that $ no longer exist.....
That's the true deep desire of most seeking financial freedom, it's not about the financial as much as it is about freedom. And hence scaling is just not an interest for most, not nearly as much as simplicity and expediency to get too freedom.
More is not more for many of us, it's just more......
Hi James,
> when a person uses their $ to purchase a property they are in direct control. In a syndication, their along for the ride.
I do not wish to be in control of the asset. I have a PhD in physics. I spent the last 20 years working in quantum computing. There are other people that have spent the last 20 years working in real estate, building companies with dozens or hundreds of employees. I want *those* people to be in control of my real estate assets, not me. People that know real estate better than I do and ever will. Take Urban Genesis for example (https://urban-genesis.com/), this is run by a guy that makes his living building multi-hundred unit multifamily apartment complexes. He manages an over billion-dollar portfolio of carefully located and designed individual assets. A vertically integrated construction company. I am never going to be that guy. I don’t want to be that guy. But I do want *that* guy to manage a syndication I participate in.
> Next big but is, when acquire a property their empowered to multiply the income potential of their investment capital far more than in a syndication, as the leverage potentials are far greater. For example, if a persons does a very simplistic strategy of O.O. buy via a 10% down, live-in for 1yr, then buy another, move, lease out the previous unit. Or really any # of effective leverage strategies such as house hacking, BRRR, value-add etc etc..
You can leverage into a syndication. All the way to 100% if you wish. You can make the return on your $0 invested technically infinite if you wish. I wish to do so and that is what I do routinely.
>> Raising even tiny amounts of money is highly educational, it forces you to analyze a deal properly, work out the likely return, keep your books properly, report results. There is a great deal of professionalism that comes with managing even a small amount of other people’s money.
> That's an intriguing point.... I find the vast majority view such as added work, stress, responsibility and accountability unto others which translates to a loss of freedom and added risk. I like the forced edu aspect, I do, although I think your missing how strong the desire of independence is in most.
If you raise $100 from someone, you are on the hook for $100 + very little after a year. You can make the stress, responsibility, and accountability, as low as you wish while you are learning. The work can be precisely 0. I use free tools that take care of all transactions, monthly statements, annual statements, tax documents, everything.
Bigger Pockets is a community. If you want independence, why be here at all? Investing independently is objectively a terrible idea. If you can get feedback from a whole community on an investment decision you are about to make, that’s a wonderful thing. It helps educate others and helps keep you safe.
>> I know how to start a managed fund with just $15k in legal fees that gives you the right to advertise publicly and raise up to $150 million. Chat GPT can’t teach you that.
> $15k is exceptionally cheap for such. Although as both you and I know there is a lot more to it then just that baseline empowerment. The real struggles come in for most in operational management.
There is no struggle when it comes to operational management as there are free tools that take care of all of this for you.
> And next in deal flow. These 2 factors are often a stopping point, because it's work, work that many do not desire to take on.
I run a forum where we share interesting deals that we are finding and do group due diligence on them. There is more than enough deal flow for everyone. Particularly in passive multifamily. There is enough deal flow to deploy hundreds of millions of dollars a month if you really wanted to.
>> "most don't care to scale" ----> I disagree. I’m not sure why you would even say that.
> Because that is the reality from the front line, this is as I experience it.
I am personally surrounded by people that want to grow. Want to scale. Perhaps I actively seek out people with a growth mindset that want to scale and that is my lived experience.
> And with that experience of hundreds upon hundreds, the vast majority, 92%+, express not only no desire to syndicate but also no desire to scale exponentially.
I also have hundreds of clients. I don’t think there is any shortage of people that wish to grow exponentially. And I stress that I do not do syndications. I have never raised capital for a specific asset as equity.
> The prevailing desire is to achieve the desired financial ends, in the most expedient means possible, within their risk appetite, as simply as possible with least impact and intrusion into their active daily lives.
Agreed. Simplicity is key, and what I focus on. Passive multifamily with the most professional operators, and OPM using free automated tools to keep the operation simple. And cash, stocks, SF LTRs, renewable energy, and flips for diversity :-)
>> ....10 to 20 rentals.... ....this is not a modest goal. Only a tiny fraction of people in the US can ever own so many rentals. 35% of households rent. The percent of people that can ever own 20 rentals is definitely less than 1%.
> This is very incorrect information, and incorrect perception.
It’s just math. A majority of households cannot even own their own home plus 1 rental household, since this would already be 100% of households. 50% of households owning two homes, 50% owning none. At 20 rentals, 21 properties total, the market is fully owned with less than 5% of people participating in property ownership, the other 95%+ being forced to rent. Financial freedom through owning dozens of homes is mathematically guaranteed to be a technique that can only be pursued to fruition by a tiny number of people.
> The first step is universal, active income production to empower investible capitol.
It’s not the only way, you can also pursue financial education and capital raising. After 10 years at university, I had to travel to Canada to pursue my trade in quantum computing. A trade that paid me just $50k Canadian a year. I would’ve made more money quicker learning to be a plumber in Australia. But I love what I do, and so I learned how to invest and raise capital while I was still a student. You do not have to focus on personal income when it comes to investing.
> This leads into the next key aspect, pyramiding. Pyramiding is how we can achieve infinite returns. Infinite returns is how we achieve rapid rates of growth.
Can you give an example of infinite returns from your own experience? As mentioned, raising all of the capital for a deal is one way you can get infinite returns, but I am curious as to what you focus on.
>> If you invest in multifamily as a group, there are no acquisition fees.
> That is exceptionally false, and misleading at best if not patently fraudulent.
> A MFH transaction has costs of transaction just like SFR's. Their is agency costs, legal facilitator costs, inspections, not to mention GP's fee's on top of it all, and so on and so fourth. Those costs are either seen and known, or encapsulated into whatever generalized price one is paying. There is no magic MFH leprechaun empowering a cost free transaction of real estate.
I’m speaking from experience here. Yes, the deal bears all those above costs. But when an investor that has allocated capital into a deal wishes to exit a deal, they can sell their stake to another investor wishing to enter that deal, and that is a transaction that can have no transaction fees. No BS, been there done that. It does require having a relationship with the operator, as not every operator will allow this, but it can be done.
>> I invest in other people’s syndications. ....I’m not running the operation.
> For a large majority of people, that is a giant risk position, it's fearful and uncomfortable to have such loss of control. And there is a great number of stories speaking of the risks come to pass, and the substantial loss of $ from such horrors realized.
See above, if you are entering into a syndication, you should be partnering with someone that is far, far better than you are at real estate. As such, being hands-off reduces the risk because you are very specifically not the one calling the shots.
>> I like helping people grow. Way more exciting.
> And i applaud you for that. Sad truth is, it's not universal, and all too many in the syndication space hold very different motives and focuses, ones not aligned to the best interest's of the LP's. It is very much so a world of LP's can make $ if and when GP's do, and if GP's don't, oh-well, sorry for your loss LP's, and onto the next....
I only work with large public operators with a published track record that they do not wish to tarnish. Such an operator faces serious consequences if they must add a failure to their track record. In the case of Urban Genesis, for example, they have taken approximately 15 buildings full cycle over 10 years with an average investor return of over 20% per annum, and no losses. Their deals are incredibly conservatively underwritten. For example, their worst deal, which led to just a 2% IRR for investors, occurred when they built a building that completed during Covid with the exception of a transformer that supply chain issues meant could not be obtained for a *year*. A fully complete building with the exception of power lay vacant and idle on construction finance for a year before they were able to begin leasing it up, and investors still didn't suffer a loss. There are incredible operations out there, and my goal as an investor is to only partner with the incredible. Another one of the operators I have worked with has been in business for 120 years. I don't work with people just starting out.
>> I disagree that people on this forum don’t want to scale, they are just trying to work out how to do so. Why else would anyone spend time reading a post like this?
> Because they want to profit. The vast majority are seeking out how-to, but don't want to put in the work for the how-to, so they keep looking around, seeking their "Golden Ticket" because of some belief that there is some easy, simple, risk free thing out there and that is how "those" people got rich. The have-not's hold a popular sentiment that the have's got to where they are via some hidden secret, access to something, a knowing of something, a connection, tip, trick or hack.
I don’t know James, I wouldn’t talk about people on this forum like that. In my experience, armed with knowledge, everyone wants to scale. The only exception being people that are already financially free and happy with their lifestyle.
> The secret is, there is no secret.
Well, I think there are certainly things that most people don’t know, but I agree there should not be secrets.
> Syndications are and always will be risky because one is putting their financial future in the hands of others, they are relinquishing control. That is a fearful thing for many, and rightfully so.
Do you invest in syndications? I do not think most people should try to build a multi-hundred unit apartment complex and lease it up. This is something for people with decades of experience. You should definitely relinquish control when investing in a deal like this. It is not right to be fearful to relinquish control to someone that knows more than you. It should be comforting.
> Syndications are right for some and not for most. Why not for most? Because a very common thread of those seeking or living as REI's is a passion for FREEDOM. FREEEEEEE-DOM! It's the spirit that literally forged this nation.
While syndications are definitely not all I do, they are definitely a very big part of my financial freedom. It’s not clear to me why you arguing that a syndication isn’t a very good way to be free. The comfort of knowing that you are partnering with someone far better at real estate than yourself. In my mind, an attitude of "I must do everything myself" would be a terrible straitjacket, and an enormous barrier to achieve true freedom. In my mind delegation is the key to freedom.
You seem to be missing my point Austin.
I am not debating to the pro's or con's of syndication, be it for GP or LP.
I am simply debating to the core of what's being underpinned in all this; that "most" seek to scale.
I argue to the contrary, that "most" do not have any interest in scaling.
That "most" have a focused interest in achieving their specific financial ends, in the most limited scale necessary to achieve that end.
That "most" view scaling as added risk, added complexity, added work.
Note I am not arguing or stating to who's right, who's wrong, or that there even is a right or wrong. I am only speaking to what I see as the prevailing majority of mindsets and interests.
Now if you look back at my historical writings you'll find I am a strong advocate of "Do what you do best, and hire the best to do the rest", which is in many ways what you speak to. We align on that front.
Now you flag syndication as the best way to do REI, or at least that's how it comes across. Is it, isn't it, I don't know, I don't think anyone can declare it either way in generality as what's a right and wrong fit is highly personalized to the individual.
There is this saying, that to a Hammer, everything looks like a nail. I get a sense that may be a loop were stuck in here.
- Tulsa ok · Member since 2025 · 84 posts · 60 votes1y
ive been in heavy rehab Single family for 22+ years started flipping then kept as long hold rentals after 2008 I am in those properties 60 to 70% LTV on average because of in house rehab and team of trusted subs. Ive have experience builing homes and rehabbed commercial properties but haven't yet taken on a multi-family property yet. But its logical next step for me to scale and if I had 10 million that would be the way to make very nice return for monthly income.
- Investor · Reseda, CA · Member since 2019 · 297 posts · 150 votes1y
Quote from @Chris Howell:
ive been in heavy rehab Single family for 22+ years started flipping then kept as long hold rentals after 2008 I am in those properties 60 to 70% LTV on average because of in house rehab and team of trusted subs. Ive have experience builing homes and rehabbed commercial properties but haven't yet taken on a multi-family property yet. But its logical next step for me to scale and if I had 10 million that would be the way to make very nice return for monthly income.
If the logical next step is to scale, what is your current plan to do so?
- Tulsa ok · Member since 2025 · 84 posts · 60 votes1yMy plan to scale is take my equity in my single families and roll into an apartment complex poorly managed and that needs updated interiors and not just paint but pretty extensive unit up grades which me and my team can complete at 40 to 60% below market prices to bring max rents in or to bring in some outside capital get asset stabilized and increased the properties margins and noi then refinance and payoff outside capital and keep property at LVT at 65% to 75%.
Quote from @Austin Fowler:
Quote from @Chris Howell:
ive been in heavy rehab Single family for 22+ years started flipping then kept as long hold rentals after 2008 I am in those properties 60 to 70% LTV on average because of in house rehab and team of trusted subs. Ive have experience builing homes and rehabbed commercial properties but haven't yet taken on a multi-family property yet. But its logical next step for me to scale and if I had 10 million that would be the way to make very nice return for monthly income.
If the logical next step is to scale, what is your current plan to do so?
Will have a very tight buy box always been pretty conservative investor. - Investor · Reseda, CA · Member since 2019 · 297 posts · 150 votes1yWhen you say "take my equity in my single families" do you mean refinance them and pull out cash or something else? When you say bring in outside capital, would you do this as debt or equity? What kind of deal do you think you would need to offer to attract the necessary capital?
Quote from @Chris Howell:
My plan to scale is take my equity in my single families and roll into an apartment complex poorly managed and that needs updated interiors and not just paint but pretty extensive unit up grades which me and my team can complete at 40 to 60% below market prices to bring max rents in or to bring in some outside capital get asset stabilized and increased the properties margins and noi then refinance and payoff outside capital and keep property at LVT at 65% to 75%.Quote from @Austin Fowler:
Quote from @Chris Howell:
ive been in heavy rehab Single family for 22+ years started flipping then kept as long hold rentals after 2008 I am in those properties 60 to 70% LTV on average because of in house rehab and team of trusted subs. Ive have experience builing homes and rehabbed commercial properties but haven't yet taken on a multi-family property yet. But its logical next step for me to scale and if I had 10 million that would be the way to make very nice return for monthly income.
If the logical next step is to scale, what is your current plan to do so?
Will have a very tight buy box always been pretty conservative investor. - Tulsa ok · Member since 2025 · 84 posts · 60 votes1y
Quote from @Austin Fowler:
When you say "take my equity in my single families" do you mean refinance them and pull out cash or something else? When you say bring in outside capital, would you do this as debt or equity? What kind of deal do you think you would need to offer to attractQuote from @Chris Howell:
My plan to scale is take my equity in my single families and roll into an apartment complex poorly managed and that needs updated interiors and not just paint but pretty extensive unit up grades which me and my team can complete at 40 to 60% below market prices to bring max rents in or to bring in some outside capital get asset stabilized and increased the properties margins and noi then refinance and payoff outside capital and keep property at LVT at 65% to 75%.Quote from @Austin Fowler:
Quote from @Chris Howell:
ive been in heavy rehab Single family for 22+ years started flipping then kept as long hold rentals after 2008 I am in those properties 60 to 70% LTV on average because of in house rehab and team of trusted subs. Ive have experience builing homes and rehabbed commercial properties but haven't yet taken on a multi-family property yet. But its logical next step for me to scale and if I had 10 million that would be the way to make very nice return for monthly income.
If the logical next step is to scale, what is your current plan to do so?
Will have a very tight buy box always been pretty conservative investor.
I would refinance my free-and-clear properties to pull cash to acquire multifamily asset. If I brought in investors it would be equity partnership that generate predictable, monthly returns. My ideal investors seek 8–12% IRR with long-term appreciation, depreciation tax benefits, and stability—offering a better option than low-yield CDs but has security. My ideal model is built for those valuing consistent income forced appreciation and security and —not high-risk, high-IRR speculation investors that max out leverage to try and reach high returns this doesnt match my investment strategy or personality.
- USA · Member since 2023 · 145 posts · 84 votes1y
@Austin Fowler good question - I'd park it in S&P index funds or total market while looking for real estate (commercial).
- Investor · Reseda, CA · Member since 2019 · 297 posts · 150 votes1y
Quote from @Josh L.:
@Austin Fowler good question - I'd park it in S&P index funds or total market while looking for real estate (commercial).
What kind of commercial real estate do you have experience in? What more specifically would you be looking to acquire?
- MD/DC · Member since 2024 · 1k+ posts · 1k+ votes1y
50% lump sum into VTSAX & 50% HYSA
Quit my jobs, my sell properties, give to charity and live my best life on $500,000+ a year.
- Rental Property Investor · San Francisco Bay Area · Member since 2022 · 1k+ posts · 1k+ votes1y
Quote from @Jules Aton:
50% lump sum into VTSAX & 50% HYSA
Quit my jobs, my sell properties, give to charity and live my best life on $500,000+ a year.
I like this answer and might change my response. Out of courtesy, I'd give employer 2 week notice. If I got a $10 million check out of the blue, I'm not even going to stress out doing real estate deals and trying to scale. The past 2.5 to 3 years have been terrible looking for Class C "cash flow on paper" properties - I won't ever get that time back even if I recoup some of the money. I like the donating to charity too.
If you asked your average person on the street in the USA who can't even cover a $1000 emergency expense what they would do with $10m, they'd thrilled (as long as they invest it properly and don't buy stupid expensive things), the people on BP are a privileged group.
I live well below my means and lead a pretty simple life but just happen to live in a VHCOL area. I could live a pretty relaxed comfortable life on index funds and HYSA.
- 1yV.G JasonPro MemberInvestor · Member since 2022 · 3k+ posts · 3k+ votes
Quote from @Becca F.:
Quote from @Jules Aton:
50% lump sum into VTSAX & 50% HYSA
Quit my jobs, my sell properties, give to charity and live my best life on $500,000+ a year.
I like this answer. Out of courtesy, I'd give employer 2 week notice. If I got a $10 million check out of the blue, I'm not even going to stress out doing real estate deals and trying to scale. I like the donating to charity too. If you asked your average person in the USA who can't even cover a $1000 emergency expense what they would do with $10m, they'd thrilled (as long as they invest it and don't buy stupid expensive things), the people on BP are a privileged group.
I've cut down on my posting and commenting to BP - I've been doing a lot of reflecting and it's not my mission in life to constantly chase money, try to find properties to buy, and do all this extra stuff which is adding to unhappiness in my life (nothing wrong with that for others if they want to scale and build a real estate empire but that's not me). I literally spent 2 years of my life losing money and looking for Class C properties to "cash flow on paper" - I won't ever get my time back even if I recoup some of the money. (Sorry for the digression but just my thoughts).
I live well below my means and lead a pretty simple life but just happen to live in a VHCOL area. I could live a pretty comfortable life on index funds and HYSA.
You'd get wiped out quick and you're totally tied to the fed funds(your HYSA will lose power) and market correction. We all are to some degree but living off say 80% index/20% HYSA would be rougher than alternate routes.
Don't confuse your gross yield against CPI. Your true CPI is way higher, your yield is net not gross, and fixed rate is on the decline.
- Flipper/Rehabber · CA · Member since 2023 · 1k+ posts · 1k+ votes1y
Quote from @Becca F.:
Quote from @Jules Aton:
50% lump sum into VTSAX & 50% HYSA
Quit my jobs, my sell properties, give to charity and live my best life on $500,000+ a year.
I like this answer and might change my response. Out of courtesy, I'd give employer 2 week notice. If I got a $10 million check out of the blue, I'm not even going to stress out doing real estate deals and trying to scale. The past 2.5 to 3 years have been terrible looking for Class C "cash flow on paper" properties - I won't ever get that time back even if I recoup some of the money. I like the donating to charity too.
If you asked your average person on the street in the USA who can't even cover a $1000 emergency expense what they would do with $10m, they'd thrilled (as long as they invest it properly and don't buy stupid expensive things), the people on BP are a privileged group.
I live well below my means and lead a pretty simple life but just happen to live in a VHCOL area. I could live a pretty relaxed comfortable life on index funds and HYSA.
Lol, ummm yeah....everytime I've gutted a tweaker house, hung sheetrock while analyzing deals, sat in E.R. getting stitches and a tetanus shot, then digging ditch. Paid my employees bonuses while doing service calls on holidays, picked up garbage at kings beach post holiday, volunteered at loaves n fishes all while putting kids through college on my 9th grade education I've always thought i was privileged.
Never confuse determination with privilege.
FWIW we're all privileged to be on this side of the dirt, and living in the USA.
- 1yJay HinrichsBusiness MemberReal Estate Consultant · Summerlin, NV · Member since 2014 · 45k+ posts · 66k+ votes
I think it depends on ones personal financial situation at the time.
If one has zero debt and a nice free and clear home to live in.. no car payments no other obligations and is on SSI and medicare.. 10mil invested in double tax free quality muni's could be a good play.. or scout the best FDIC 250k rate returns out there maybe get 5% .
500k a year most of it tax free seems to be a nice retirement number why risk any real estate or anything else for that matter.. Unless you really want to work and manage properties.
other than that be the bank and lend at 8 to 12% plus a point or two and cherry pick the absolute best deals out there..
For younger investors who still have debt and obligations and the energy to run rentals i guess that would appeal to many of them. Not me personally rentals would be the last thing I would do.
- Rental Property Investor · Somewhere over the Rainbow · Member since 2021 · 1k+ posts · 1k+ votes1y
I understand how you have access to the 10m, what I don't understand is how you can deploy only a percentage of the capital you manage, and earn a a return greater than the 8% paid out to 100% of the capital you manage, consistently. I don't understand how there is enough left after you pay the 8% out to investors.
I understand you're essentially acting as the bank (syndicator) in this case.
I remember speaking with you and you're a smart guy with an interesting system. I personally didn't have the time, risk tolerance, and legal assurance to do it though.
To answer the thread though - I'd honestly put the vast majority in index funds, then buy a commercial real estate asset for the additional cashflow and tax deductions - car wash, storage, drive-through coffee, tow yard, etc
- Investor · Reseda, CA · Member since 2019 · 297 posts · 150 votes1y
Quote from @Jeremy Horton:
I understand how you have access to the 10m, what I don't understand is how you can deploy only a percentage of the capital you manage, and earn a a return greater than the 8% paid out to 100% of the capital you manage, consistently. I don't understand how there is enough left after you pay the 8% out to investors.
I understand you're essentially acting as the bank (syndicator) in this case.
I remember speaking with you and you're a smart guy with an interesting system. I personally didn't have the time, risk tolerance, and legal assurance to do it though.
To answer the thread though - I'd honestly put the vast majority in index funds, then buy a commercial real estate asset for the additional cashflow and tax deductions - car wash, storage, drive-through coffee, tow yard, etc
Hi Jeremy,
> I understand how you have access to the 10m, what I don't understand is how you can deploy only a percentage of the capital you manage, and earn a a return greater than the 8% paid out to 100% of the capital you manage, consistently. I don't understand how there is enough left after you pay the 8% out to investors.
I have no qualms sharing asset overview publicly. You can review my assets here. I have a diverse portfolio spanning cash, stocks, renewable energy, single-family long-term rentals, multifamily syndications (primarily development), and flips. I am very active in my asset selection. My ballpark target is a 20% return on capital per year. I have a long track record of hitting numbers around this.
> I understand you're essentially acting as the bank (syndicator) in this case.
> I remember speaking with you and you're a smart guy with an interesting system. I personally didn't have the time, risk tolerance, and legal assurance to do it though.
I do have time. My calendar is quite open. Anyone wants to set up a chat, just direct message me. Happy to answer any questions one-on-one.
> To answer the thread though - I'd honestly put the vast majority in index funds, then buy a commercial real estate asset for the additional cashflow and tax deductions - car wash, storage, drive-through coffee, tow yard, etc
Have you ever owned a car wash, tow yard, or copy shop? That sounds interesting. Not something I have done.
- 1yV.G JasonPro MemberInvestor · Member since 2022 · 3k+ posts · 3k+ votes
For all y'all saying HYSA and S&P, you'll get killed against the dollar in any (long) term period at this point going forward. Really covid going forward.
It's businesses & hard assets or bust; gold, Bitcoin, re.
go tell me where the spy is this year YTD.
- Member since 2025 · 1 post · 0 votes1y
Most people would diversify with less than $10 million, including stocks, real estate, private equity, and possibly some safe bonds, while managing risk and growth with the help of a reliable financial team.
- Investor · Milwaukee - Mequon, WI · Member since 2010 · 5k+ posts · 7k+ votes1y
The OP question is very hypothetical because it leaves out the personal context.
If you get $10M out of the blue (inheritance), odds are you'll lose it within a year or two. But if you are self-made, you'll continue building on your knowledge. If you were a farmer, you might just buy more land. If you are in tech, maybe you build 3 data centers. If you don't have RE experience and start with $10M chances are you'll blow it.
Preservation becomes your #1 concern; you don't want to go back to working for paychecks, so you'll do whatever feels the safest and that is typically a field you have experience and knowledge.
- 1yJoe S.Pro MemberInvestor · San Antonio · Member since 2020 · 3k+ posts · 3k+ votesif you are self-made, you'll continue building on your knowledge
Quote from @Marcus Auerbach:
The OP question is very hypothetical because it leaves out the personal context.
If you get $10M out of the blue (inheritance), odds are you'll lose it within a year or two. But if you are self-made, you'll continue building on your knowledge. If you were a farmer, you might just buy more land. If you are in tech, maybe you build 3 data centers. If you don't have RE experience and start with $10M chances are you'll blow it.
Preservation becomes your #1 concern; you don't want to go back to working for paychecks, so you'll do whatever feels the safest and that is typically a field you have experience and knowledge.
That makes a lot of sense.✅ - Investor · Reseda, CA · Member since 2019 · 297 posts · 150 votes1y
Quote from @Marcus Auerbach:
The OP question is very hypothetical because it leaves out the personal context.
If you get $10M out of the blue (inheritance), odds are you'll lose it within a year or two. But if you are self-made, you'll continue building on your knowledge. If you were a farmer, you might just buy more land. If you are in tech, maybe you build 3 data centers. If you don't have RE experience and start with $10M chances are you'll blow it.
Preservation becomes your #1 concern; you don't want to go back to working for paychecks, so you'll do whatever feels the safest and that is typically a field you have experience and knowledge.
Hi Marcus,
How would *you* invest the $10M? The goal of this thread is to identify people that know how to handle capital at scale. Get them sharing their knowledge. Shake out some new ideas. Expose everyone to surprising things they didn’t know they didn’t know.
I spoke to an investor a couple of weeks back that was buying $4 million container ship sized banks of computing power for bitcoin mining. Each container requires 2.4 MW of electricity. Fascinating discussion. For $35,000 in electricity cost to run the hardware, they were able to mine a bitcoin worth as of today over $110,000. Still in contact with them, want to know how long the hardware lasts, but it’s a good example of something I didn’t know that I didn’t know. Bring on the professionals, share what you know with everyone :-)
- Investor · Milwaukee - Mequon, WI · Member since 2010 · 5k+ posts · 7k+ votes1y
Quote from @Austin Fowler:
Quote from @Marcus Auerbach:
The OP question is very hypothetical because it leaves out the personal context.
If you get $10M out of the blue (inheritance), odds are you'll lose it within a year or two. But if you are self-made, you'll continue building on your knowledge. If you were a farmer, you might just buy more land. If you are in tech, maybe you build 3 data centers. If you don't have RE experience and start with $10M chances are you'll blow it.
Preservation becomes your #1 concern; you don't want to go back to working for paychecks, so you'll do whatever feels the safest and that is typically a field you have experience and knowledge.
Hi Marcus,
How would *you* invest the $10M? The goal of this thread is to identify people that know how to handle capital at scale. Get them sharing their knowledge. Shake out some new ideas. Expose everyone to surprising things they didn’t know they didn’t know.
I spoke to an investor a couple of weeks back that was buying $4 million container ship sized banks of computing power for bitcoin mining. Each container requires 2.4 MW of electricity. Fascinating discussion. For $35,000 in electricity cost to run the hardware, they were able to mine a bitcoin worth as of today over $110,000. Still in contact with them, want to know how long the hardware lasts, but it’s a good example of something I didn’t know that I didn’t know. Bring on the professionals, share what you know with everyone :-)
That's a really cool opportunity. I don't have anything like that. My portfolio is entirely single-family homes in the suburbs. I know the market like the back of my hand and would never feel comfortable buying a containership for bitcoin or just to haul cargo - it's not where I have an unfair advantage. The only other field I could invest would be construction equipment rental - I have worked in that industry on the manufacturer side and I have seen how profitable equipment rental is. Plus I understand enough about excavators, skid steers and diesel engines to hold a conversation with a mechanic..
- Investor · Reseda, CA · Member since 2019 · 297 posts · 150 votes1y
Quote from @Marcus Auerbach:
Quote from @Austin Fowler:
Quote from @Marcus Auerbach:
The OP question is very hypothetical because it leaves out the personal context.
If you get $10M out of the blue (inheritance), odds are you'll lose it within a year or two. But if you are self-made, you'll continue building on your knowledge. If you were a farmer, you might just buy more land. If you are in tech, maybe you build 3 data centers. If you don't have RE experience and start with $10M chances are you'll blow it.
Preservation becomes your #1 concern; you don't want to go back to working for paychecks, so you'll do whatever feels the safest and that is typically a field you have experience and knowledge.
Hi Marcus,
How would *you* invest the $10M? The goal of this thread is to identify people that know how to handle capital at scale. Get them sharing their knowledge. Shake out some new ideas. Expose everyone to surprising things they didn’t know they didn’t know.
I spoke to an investor a couple of weeks back that was buying $4 million container ship sized banks of computing power for bitcoin mining. Each container requires 2.4 MW of electricity. Fascinating discussion. For $35,000 in electricity cost to run the hardware, they were able to mine a bitcoin worth as of today over $110,000. Still in contact with them, want to know how long the hardware lasts, but it’s a good example of something I didn’t know that I didn’t know. Bring on the professionals, share what you know with everyone :-)
That's a really cool opportunity. I don't have anything like that. My portfolio is entirely single-family homes in the suburbs. I know the market like the back of my hand and would never feel comfortable buying a containership for bitcoin or just to haul cargo - it's not where I have an unfair advantage. The only other field I could invest would be construction equipment rental - I have worked in that industry on the manufacturer side and I have seen how profitable equipment rental is. Plus I understand enough about excavators, skid steers and diesel engines to hold a conversation with a mechanic..
Clarification: I meant shipping container, not container ship :-) a 40' shipping container of computer hardware.
- 1yBasit SiddiqiBusiness MemberAccountant · New York, NY · Member since 2015 · 8k+ posts · 3k+ votes
I would do the following
$5,000,000 into the stock market
$3,000,000 into real estate / syndications
$0 in bonds
$1,000,000 to invest in small businesses
$1,000,000 to put towards my own small business of something that brings me joy(resturant)
Basit Siddiqi CPA4.979 Reviews - 1yJulius VincentBusiness MemberTax Strategist | CPA, MBA + Wharton FP&A | CFO-Level Planning · Houston, TX · Member since 2025 · 157 posts · 172 votes
If I had $10M, I’d split it between cash-flowing STRs and scalable multifamily. STRs can throw off 3–5x the cash flow of long-term rentals, which means you can recycle capital fast and keep scaling without waiting years to save up for the next deal. In her book, Short-Term Rental Long-Term Wealth, Avery Carl lays out how the right STR markets (especially drivable, recession-resistant vacation markets) hold up even during downturns. With a portfolio of those, you've got serious income to redeploy.
The other half I’d put into larger multifamily or syndications for stability and appreciation. That’s where the Rich Dad Poor Dad mindset comes in...use assets that produce cash flow to buy more assets, while keeping liabilities low.
$10M is enough to build both immediate cash flow (STRs) and long-term wealth (multifamily). The key is not trying to do it solo. You’d want a solid team, systems, and probably a property management infrastructure from day one.
Horizon Wealth & Tax Advisors510 Reviews - Investor · Fairfax, VA · Member since 2015 · 1k+ posts · 798 votes1y
Here are the returns I'm getting: Keep in mind these are conservative investments with very little risk. The goal of this portfolio is not scale or leverage but income. Here is how I would divide up the 10 Million.
12% mortgage notes. 2,000,000. or 240K a year (3 separate note funds)
10% Private Credit. 2,000,000 or 200K a year (3 separate note funds)
7%. NNN lease property 5,000,000 or $350K a year (corporate standalone, or small strip center in a dense neighborhood)
4% Money Market $1,000,000 or 40K a year
Total Income for the year: $830,000
About 1/2 the income would be rolled back into the current investments and I would live on the other 1/2.
- 1yV.G JasonPro MemberInvestor · Member since 2022 · 3k+ posts · 3k+ votes
Quote from @John M.:
Here are the returns I'm getting: Keep in mind these are conservative investments with very little risk. The goal of this portfolio is not scale or leverage but income. Here is how I would divide up the 10 Million.
12% mortgage notes. 2,000,000. or 240K a year (3 separate note funds)
10% Private Credit. 2,000,000 or 200K a year (3 separate note funds)
7%. NNN lease property 5,000,000 or $350K a year (corporate standalone, or small strip center in a dense neighborhood)
4% Money Market $1,000,000 or 40K a year
Total Income for the year: $830,000
About 1/2 the income would be rolled back into the current investments and I would live on the other 1/2.
$830k gross, not taxed. That'd be likely $500k after taxes(5% return), and no real assets besides the NNN one. And the 12% notes inherently carry more risk.
Outside of your leases, you're growing in dollars. Need to grow in assets. You're doing the inverse. You want (hard) asset backed revenue streams.
This is good cash flow today though. The game is
Cash->(hard) assets with some leverage-> return some cash-> recycle into more (hard) assets with some leverage-> return more cash return. Do that 2-3 cycles over, depending on age, then take some returns or trim and pay off debt.
You don't want the same outputs without the asset. That's wealth destruction. You need to bet against the dollar not be neutral, which is inherently net negative. Hard asset with 20-40% leverage, can do more for RE but nothing crazy.
- 1yHenry ClarkPro MemberDeveloper · Member since 2020 · 4k+ posts · 4k+ votes
OP we are past our number so the following is just for scaling considerations.
I have one town I would build 20. 300 unit Selfstorage locations. At $10mm with Comml loan at 25% LTV or $40mm investment. Would hire 1 person for $100,000 per year to follow my instructions for 4 years. Would sell all of these starting at year 3. Would get the original $10mm back plus $30mm less taxes, say $20mm.
Then I would go to the East coast and take the $30mm at 25% LTV or $130mm asset. Around 3 major NE cities. Do the same thing with 2 hires this time. Sell again. Get the $30mm original plus $90mm less taxes say $70mm.
Now I would take the $100mm and divide into 3 investment approaches.A. Would take on the large Self Storage REITS at the major West coast cities SD, LA, SF, WA, OR with a new disruptive business model. Develop a $500mm business. Sale after 3 years. Have the previous 2 managers manage.
B. Would track down two guys I know in the Music business. Take his idea and get Ticketmaster to back. Develop a $1bl business worldwide. Sell 2 years later. Hire prior business manager to manage.
C. The last $33mm would invest in Belize Teak plantation development. Harvest 25 years later and process for wholesale for $500mm and sale into the India, China and Europe market. Have my current plantation manage.
I would be on this island all this time doing FaceTime with them.
- 1yDrew SygitBusiness MemberProperty Manager · Royal Oak, MI · Member since 2012 · 12k+ posts · 9k+ votes
Invest in storage!
Logical Property Management4.9451 Reviews - New to Real Estate · Miami, FL · Member since 2024 · 1k+ posts · 448 votes1y
Great question, Austin!
$10M opens up serious opportunity, but also requires strategic control.
I'd split it across multiple verticals to balance growth, cash flow, and downside protection. Think: stabilized multifamily (direct ownership or syndications) for steady income, value-add commercial for forced appreciation, and a mix of short-term flips or new builds in high-demand submarkets. Geographic diversification would be key , ideally in landlord-friendly, growing metros.
A core team would be essential: acquisitions lead, underwriter, legal/tax advisor, and boots-on-the-ground operators. With strong deal flow channels already in place, you could deploy $10M over 12–18 months targeting IRRs in the 12–18% range depending on risk.
It’s less about how much capital you have and more about your pipeline, people, and process.
- 1yKerry Noble JrPro MemberInvestor · Indianapolis, IN · Member since 2018 · 2k+ posts · 1k+ votes
If I had 10M how would I invest it?
Welp, currently I've been doing small bridge loans leveraging my business credit cards and credit lines. They're short term bridge loans (generally net 30) bringing in 20% ROI. Were talking 10K and under, so i would 10X that. I've funded government contracts also. I would also add factoring and floating payroll for small businesses. Then I would do some private money lending on rehabs as well as my own wholesaling operation. lastly I have recently signed up for these large commercial notes notification. for example, I currently have opportunities for a $3M non performing note on a medical device company, $9.14M non performing multifamily loan on 188 units appraised at 12.5M and $11M matured loan on a healthcare loan. I would start small with the $3M opportunity and work my way up to the larger deals as we get that 10M working.
I would love to connect with anyone that would be interested in connecting and working together on anything that i have currently going on!
- Investor · Reseda, CA · Member since 2019 · 297 posts · 150 votes1y
Let's drop the aspect of the discussion trying to argue what most people want. Ultimately your viewpoint will depend on the kinds of people you surround yourself with and the kinds of conversations you have with them.
I'm passionate about scaling so I can have a greater impact, primarily through donating and advocating for Opportunity International. Allocating capital into syndications as an LP is the best way I know of at the moment to scale, but the whole point of this thread, and indeed every interaction I have on BP, is to meet people and learn techniques that can help me do better. Are you also here to learn new ideas?
- Real Estate Broker · Minneapolis, MN · Member since 2011 · 5k+ posts · 6k+ votes1y
Quote from @Austin Fowler:
Let's drop the aspect of the discussion trying to argue what most people want. Ultimately your viewpoint will depend on the kinds of people you surround yourself with and the kinds of conversations you have with them.
I'm passionate about scaling so I can have a greater impact, primarily through donating and advocating for Opportunity International. Allocating capital into syndications as an LP is the best way I know of at the moment to scale, but the whole point of this thread, and indeed every interaction I have on BP, is to meet people and learn techniques that can help me do better. Are you also here to learn new ideas?
I am here for a handful of reasons, depending on the day & time I may wonder myself why I am on BP anymore at all, given how things have changed.
The primary reason is the old carpenters adage; a dull tool makes for poor results. One keeps both tool and skill sharp, via regular use. Can take the man out of carpentry, but never the carpenter out of the man I suppose.
Second is keeping my ears to the tracks. Via BP I get to hear all kinds of things, straight from the horses mouth as it were, that I'd probably not otherwise known. Especially in todays age where one has to wonder what, if any, media can be trusted anymore.
Lastly, but far from least, is ABL, Always be Learning. Life has 2 modes, growth and death. You don't know what you don't know. Combine those 2 aspects and one never knows what could strike as inspiration, cross utilization, something new or different to learn, adapt, ponder that brings about who knows what.
I know, marketing myself should be on this list but honestly I am horrible at marketing myself, it's my Achilles heel really. I am amazing at marketing a property, not so much myself, lol.
Look, you do excellent at signing the very valid pro's of syndication Austin, especially with the particulars you speak to in the how-2. Your arguably the spokesperson for how it can go right as you use some very solid points.
My only contention are; it's not necessarily a fit for everyone, and, not all syndication experiences would align with your vision and experience of it.
Sad reality is theirs a fair bit of persons who promote syndication for very self-aligned motives, even narcissistic if not nefarious or even malicious in intent.
Now, not fair to judge all apples by fact of some rotten ones, right. I know of some fantastic syndicators out there, really stand up people and operators. But, there is some predators in those waters too, it's not all rainbows and fairy-farts.
I am a bit jaded on concept of mass capability to properly manage raised capitol by fact I have seen so-dang-many failed landlords. Time and time again all but universally stemming from self-inflicted injury. Often some form or fashion of gross negligence. Generally saying the same thing; "I new I should/shouldn't have done ___, but, I ___ anyways....". It's a wildly common theme.
So I just don't have the blind faith in GP's and syndication you seem to have Austin.
I value control. I value that if I or a client has control, we can pivot, because over the years and decades I and many clients have had to do exactly that, pivot. We had to make fruit salad out of the lemons. And I have seen all too many syndicated deals and syndicators implode in past recent. Ones thought titanium, turned tinfoil and shredded.
BP has had a great many posts from LP's lamenting their various horrors come to pass. It strikes a very cautious cord in a person.
- Flipper/Rehabber · CA · Member since 2023 · 1k+ posts · 1k+ votes1y
Quote from @James Hamling:
Quote from @Austin Fowler:
Let's drop the aspect of the discussion trying to argue what most people want. Ultimately your viewpoint will depend on the kinds of people you surround yourself with and the kinds of conversations you have with them.
I'm passionate about scaling so I can have a greater impact, primarily through donating and advocating for Opportunity International. Allocating capital into syndications as an LP is the best way I know of at the moment to scale, but the whole point of this thread, and indeed every interaction I have on BP, is to meet people and learn techniques that can help me do better. Are you also here to learn new ideas?
I am here for a handful of reasons, depending on the day & time I may wonder myself why I am on BP anymore at all, given how things have changed.
The primary reason is the old carpenters adage; a dull tool makes for poor results. One keeps both tool and skill sharp, via regular use. Can take the man out of carpentry, but never the carpenter out of the man I suppose.
Second is keeping my ears to the tracks. Via BP I get to hear all kinds of things, straight from the horses mouth as it were, that I'd probably not otherwise known. Especially in todays age where one has to wonder what, if any, media can be trusted anymore.
Lastly, but far from least, is ABL, Always be Learning. Life has 2 modes, growth and death. You don't know what you don't know. Combine those 2 aspects and one never knows what could strike as inspiration, cross utilization, something new or different to learn, adapt, ponder that brings about who knows what.
I know, marketing myself should be on this list but honestly I am horrible at marketing myself, it's my Achilles heel really. I am amazing at marketing a property, not so much myself, lol.
Look, you do excellent at signing the very valid pro's of syndication Austin, especially with the particulars you speak to in the how-2. Your arguably the spokesperson for how it can go right as you use some very solid points.
My only contention are; it's not necessarily a fit for everyone, and, not all syndication experiences would align with your vision and experience of it.
Sad reality is theirs a fair bit of persons who promote syndication for very self-aligned motives, even narcissistic if not nefarious or even malicious in intent.
Now, not fair to judge all apples by fact of some rotten ones, right. I know of some fantastic syndicators out there, really stand up people and operators. But, there is some predators in those waters too, it's not all rainbows and fairy-farts.
I am a bit jaded on concept of mass capability to properly manage raised capitol by fact I have seen so-dang-many failed landlords. Time and time again all but universally stemming from self-inflicted injury. Often some form or fashion of gross negligence. Generally saying the same thing; "I new I should/shouldn't have done ___, but, I ___ anyways....". It's a wildly common theme.
So I just don't have the blind faith in GP's and syndication you seem to have Austin.
I value control. I value that if I or a client has control, we can pivot, because over the years and decades I and many clients have had to do exactly that, pivot. We had to make fruit salad out of the lemons. And I have seen all too many syndicated deals and syndicators implode in past recent. Ones thought titanium, turned tinfoil and shredded.
BP has had a great many posts from LP's lamenting their various horrors come to pass. It strikes a very cautious cord in a person.
Imo you're on the forum to help people with less experience, notice Nicholas & Joe also updated you? They also give advice to newbies, that's the best reason to be on this forum, helping others.
- Real Estate Broker · Minneapolis, MN · Member since 2011 · 5k+ posts · 6k+ votes1y
Quote from @Alan F.:
Quote from @James Hamling:
Quote from @Austin Fowler:
Let's drop the aspect of the discussion trying to argue what most people want. Ultimately your viewpoint will depend on the kinds of people you surround yourself with and the kinds of conversations you have with them.
I'm passionate about scaling so I can have a greater impact, primarily through donating and advocating for Opportunity International. Allocating capital into syndications as an LP is the best way I know of at the moment to scale, but the whole point of this thread, and indeed every interaction I have on BP, is to meet people and learn techniques that can help me do better. Are you also here to learn new ideas?
I am here for a handful of reasons, depending on the day & time I may wonder myself why I am on BP anymore at all, given how things have changed.
The primary reason is the old carpenters adage; a dull tool makes for poor results. One keeps both tool and skill sharp, via regular use. Can take the man out of carpentry, but never the carpenter out of the man I suppose.
Second is keeping my ears to the tracks. Via BP I get to hear all kinds of things, straight from the horses mouth as it were, that I'd probably not otherwise known. Especially in todays age where one has to wonder what, if any, media can be trusted anymore.
Lastly, but far from least, is ABL, Always be Learning. Life has 2 modes, growth and death. You don't know what you don't know. Combine those 2 aspects and one never knows what could strike as inspiration, cross utilization, something new or different to learn, adapt, ponder that brings about who knows what.
I know, marketing myself should be on this list but honestly I am horrible at marketing myself, it's my Achilles heel really. I am amazing at marketing a property, not so much myself, lol.
Look, you do excellent at signing the very valid pro's of syndication Austin, especially with the particulars you speak to in the how-2. Your arguably the spokesperson for how it can go right as you use some very solid points.
My only contention are; it's not necessarily a fit for everyone, and, not all syndication experiences would align with your vision and experience of it.
Sad reality is theirs a fair bit of persons who promote syndication for very self-aligned motives, even narcissistic if not nefarious or even malicious in intent.
Now, not fair to judge all apples by fact of some rotten ones, right. I know of some fantastic syndicators out there, really stand up people and operators. But, there is some predators in those waters too, it's not all rainbows and fairy-farts.
I am a bit jaded on concept of mass capability to properly manage raised capitol by fact I have seen so-dang-many failed landlords. Time and time again all but universally stemming from self-inflicted injury. Often some form or fashion of gross negligence. Generally saying the same thing; "I new I should/shouldn't have done ___, but, I ___ anyways....". It's a wildly common theme.
So I just don't have the blind faith in GP's and syndication you seem to have Austin.
I value control. I value that if I or a client has control, we can pivot, because over the years and decades I and many clients have had to do exactly that, pivot. We had to make fruit salad out of the lemons. And I have seen all too many syndicated deals and syndicators implode in past recent. Ones thought titanium, turned tinfoil and shredded.
BP has had a great many posts from LP's lamenting their various horrors come to pass. It strikes a very cautious cord in a person.
Imo you're on the forum to help people with less experience, notice Nicholas & Joe also updated you? They also give advice to newbies, that's the best reason to be on this forum, helping others.
I appreciate you Alan.
That is what I meant by keeping tool & skill sharp, via doing.
When I started Edu for Engineering, I'll never forget my 1st awesome Professor. Class started with a test of define Engineer in simplest, most direct but complete terms. Everyone got it wrong, we over thought it. No shock right, a room full of aspiring Engineers over thinking something.
The answer was: Problem Solver.
That's how I view myself, my work, my services, to today; Problem Solver.
I solve problems with real estate, about real estate and via real estate.
And I'm dang good at it too, I'm a natural born problem solver. I was a great engineer as well but problem was the work literally bored me to sleep. I was a Manufacturing Engineer specializing in metallurgy. Sound boring? Yeah, because it was. When even a high profile job for NASCAR left me bored out of my mind, that's when I knew I had to make a move.
So past the real estate stuff, I really get it from personal experience too, life with golden handcuffs. Because I also wore them.
I never had BP when I got my start, it was a miracle I survived the plethora of mistakes I made. I genuinely get pleasure from helping others walking in those shoes, or similar paths.
You know when people say if you could go back and do it all again knowing what you know now? Well, it kinda feels like doing that in some part, no time machine but it has a feeling like that, getting to help in whatever way to someone reminiscent of our journey.
There is some great people on BP, I like to think your one of them, who seem to share this altruistic underpinning.
- Flipper/Rehabber · CA · Member since 2023 · 1k+ posts · 1k+ votes1y
Quote from @James Hamling:
Quote from @Alan F.:
Quote from @James Hamling:
Quote from @Austin Fowler:
Let's drop the aspect of the discussion trying to argue what most people want. Ultimately your viewpoint will depend on the kinds of people you surround yourself with and the kinds of conversations you have with them.
I'm passionate about scaling so I can have a greater impact, primarily through donating and advocating for Opportunity International. Allocating capital into syndications as an LP is the best way I know of at the moment to scale, but the whole point of this thread, and indeed every interaction I have on BP, is to meet people and learn techniques that can help me do better. Are you also here to learn new ideas?
I am here for a handful of reasons, depending on the day & time I may wonder myself why I am on BP anymore at all, given how things have changed.
The primary reason is the old carpenters adage; a dull tool makes for poor results. One keeps both tool and skill sharp, via regular use. Can take the man out of carpentry, but never the carpenter out of the man I suppose.
Second is keeping my ears to the tracks. Via BP I get to hear all kinds of things, straight from the horses mouth as it were, that I'd probably not otherwise known. Especially in todays age where one has to wonder what, if any, media can be trusted anymore.
Lastly, but far from least, is ABL, Always be Learning. Life has 2 modes, growth and death. You don't know what you don't know. Combine those 2 aspects and one never knows what could strike as inspiration, cross utilization, something new or different to learn, adapt, ponder that brings about who knows what.
I know, marketing myself should be on this list but honestly I am horrible at marketing myself, it's my Achilles heel really. I am amazing at marketing a property, not so much myself, lol.
Look, you do excellent at signing the very valid pro's of syndication Austin, especially with the particulars you speak to in the how-2. Your arguably the spokesperson for how it can go right as you use some very solid points.
My only contention are; it's not necessarily a fit for everyone, and, not all syndication experiences would align with your vision and experience of it.
Sad reality is theirs a fair bit of persons who promote syndication for very self-aligned motives, even narcissistic if not nefarious or even malicious in intent.
Now, not fair to judge all apples by fact of some rotten ones, right. I know of some fantastic syndicators out there, really stand up people and operators. But, there is some predators in those waters too, it's not all rainbows and fairy-farts.
I am a bit jaded on concept of mass capability to properly manage raised capitol by fact I have seen so-dang-many failed landlords. Time and time again all but universally stemming from self-inflicted injury. Often some form or fashion of gross negligence. Generally saying the same thing; "I new I should/shouldn't have done ___, but, I ___ anyways....". It's a wildly common theme.
So I just don't have the blind faith in GP's and syndication you seem to have Austin.
I value control. I value that if I or a client has control, we can pivot, because over the years and decades I and many clients have had to do exactly that, pivot. We had to make fruit salad out of the lemons. And I have seen all too many syndicated deals and syndicators implode in past recent. Ones thought titanium, turned tinfoil and shredded.
BP has had a great many posts from LP's lamenting their various horrors come to pass. It strikes a very cautious cord in a person.
Imo you're on the forum to help people with less experience, notice Nicholas & Joe also updated you? They also give advice to newbies, that's the best reason to be on this forum, helping others.
I appreciate you Alan.
That is what I meant by keeping tool & skill sharp, via doing.
When I started Edu for Engineering, I'll never forget my 1st awesome Professor. Class started with a test of define Engineer in simplest, most direct but complete terms. Everyone got it wrong, we over thought it. No shock right, a room full of aspiring Engineers over thinking something.
The answer was: Problem Solver.
That's how I view myself, my work, my services, to today; Problem Solver.
I solve problems with real estate, about real estate and via real estate.
And I'm dang good at it too, I'm a natural born problem solver. I was a great engineer as well but problem was the work literally bored me to sleep. I was a Manufacturing Engineer specializing in metallurgy. Sound boring? Yeah, because it was. When even a high profile job for NASCAR left me bored out of my mind, that's when I knew I had to make a move.
So past the real estate stuff, I really get it from personal experience too, life with golden handcuffs. Because I also wore them.
I never had BP when I got my start, it was a miracle I survived the plethora of mistakes I made. I genuinely get pleasure from helping others walking in those shoes, or similar paths.
You know when people say if you could go back and do it all again knowing what you know now? Well, it kinda feels like doing that in some part, no time machine but it has a feeling like that, getting to help in whatever way to someone reminiscent of our journey.
There is some great people on BP, I like to think your one of them, who seem to share this altruistic underpinning.
Lol, my greatness is questionable 😅 I like your direct answers, you remind me of old school engineers out "on the floor " not just a CAD operator.
- 1yV.G JasonPro MemberInvestor · Member since 2022 · 3k+ posts · 3k+ votesI help people by criticizing them.
Quote from @Alan F.:
Imo you're on the forum to help people with less experience, notice Nicholas & Joe also updated you? They also give advice to newbies, that's the best reason to be on this forum, helping others.
- Flipper/Rehabber · CA · Member since 2023 · 1k+ posts · 1k+ votes1y
Quote from @V.G Jason:
I help people by criticizing them.Quote from @Alan F.:
Imo you're on the forum to help people with less experience, notice Nicholas & Joe also updated you? They also give advice to newbies, that's the best reason to be on this forum, helping others.
I give me tons of homework! 🙃
- Rental Property Investor · Member since 2018 · 826 posts · 810 votes1y
I think most folks are not properly factoring tax consequences - and they are material at this level of capital deployment. Any dividend paying vehicle should be at bottom of the list or nearly excluded as you’ll pay ~50% taxes on ordinary income.
I’d go down the path of leveraging against hard assets to hedge against inflation and maximize tax shielding. Find a high cost area and buy a 20-30 unit property and you’ll minimize head aches. Better yet, diversify and pick up a few smaller unit properties to defray risk.
- Rental Property Investor · St. Paul, MN · Member since 2016 · 3k+ posts · 3k+ votes1y
I would take a very similar approach to $10M as to $1M. For me personally, 80%+ would be invested into my own syndications. Then the remaining would be invested into companies. I would split that between established companies via the stock market and some start-ups. I would also take around 1-2% and invest it in crypto.
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