First Deal? Don’t Start With 5+ Units

[Mark Bassali]

Been seeing this scenario constantly lately:

Brand new investor wants to buy a 5+ unit multifamily… and roll rehab into the financing.

Here’s the hard truth. 5+ units are commercial. Lenders aren’t just qualifying the property, they’re qualifying you. On value-add deals, most want to see experience. Ideally at least one successful project or exit. No track record + heavy rehab + commercial debt = uphill battle.

Multifamily is great. I love it. But overextending on your first acquisition is how people get wiped out.

If you have zero experience, 2–4 units are far more forgiving.
Residential financing. Lower barriers. More lender options.
You can house hack, stabilize, learn operations, then scale.

Build the track record first. Then go bigger.

[Jules Aton]

Wait, what? This isn't the way to go in a class C or D neighborhood in Ohio that you can manage by yourself from hours away? ;)