What is the most under realized opportunity in real estate today?

147 Replies

It seems like so many clients and friends I talk to want to get started in real estate investing.  With all the accessible information (including from platforms like BP) interest is higher than ever.

My question is simply this... where is the best opportunity?  Multi-family is red hot and cap rates are plummeting.  SFRs are pricey, given owner occupant demand.  Commercial can be sketchy as more businesses are able to operate remotely.  Eliminating the variable of local market conditions, what is the overall underappreciated opportunity in today's investing environment? 

Investing in multi-unit properties even as small as 4 units. It seems like millions and millions of investors have their heads buried in the sand and they have single family homes burned deep into their small brains. I seriously want to punch brokers who tell me you can make as much with single family homes as multi-unit properties and I will challenge any real estate broker or investor, any day. and that is no b.s. nor joke. Bring it on! I love a good argument.

Hello Mr. Broker! Hey, Jack! How are you doing. Just great! I lost my job, my dog was hit by a car last week and my wife left me for the gardener. So, I thought that since I have more time for myself I would look for some properties to invest in and when I get rich I'm going to Asia to buy one of those Mail Order Brides. 

Gee, Jack! How much do you have to invest. Well, I think I have about $600,000 and maybe a little more. What do you have where I can make a good return on my money. Well, I just listed these three 3-bedroom homes for about $850,000 EACH. They were recently remodeled and are in a nice neighborhood. I was thinking about something that would appreciate in value a little more. Do you have any four-plexes or apartment buildings. Gee, Jack! I wish I did. You know when an apartment building gets on the market it sells in a few hours. Let me print you a list for these houses AND YOU LET ME KNOW WHAT YOU THINK.

This is the typical conversation when you speak with real estate agents of brokers. I told the broker I am LOOKING FOR AN INVESTMENT WHERE I CAN GET A DECENT ROI, but the broker's ears are deaf to what I want and he still proceeds to PUSH ONLY WHAT HE HAS to fill his wallet with some easy cash when you are dumb enough to go look at those three houses.

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Originally posted by @Jack Orthman :

Investing in multi-unit properties even as small as 4 units. It seems like millions and millions of investors have their heads buried in the sand and they have single family homes burned deep into their small brains. I seriously want to punch brokers who tell me you can make as much with single family homes as multi-unit properties and I will challenge any real estate broker or investor, any day. and that is no b.s. nor joke. Bring it on! I love a good argument.

 Very interesting

any guess why Blackstone chose to buy 6 Billion dollars worth of SFH to rent out VS buying multifamily?

Originally posted by @Michael Plante :
Originally posted by @Jack Orthman:

Investing in multi-unit properties even as small as 4 units. It seems like millions and millions of investors have their heads buried in the sand and they have single family homes burned deep into their small brains. I seriously want to punch brokers who tell me you can make as much with single family homes as multi-unit properties and I will challenge any real estate broker or investor, any day. and that is no b.s. nor joke. Bring it on! I love a good argument.

 Very interesting

any guess why Blackstone chose to buy 6 Billion dollars worth of SFH to rent out VS buying multifamily?

Sorry! I disagree 100% and would like for you to tell me why Blackstone purchase $6 million worth of single family homes.

I won't use the word 'perhaps'. I will bet that Blackstone would have been better off purchasing multi-unit properties.

The book 'Be Obsessed or Be Average' written by Grant Cardone is actually a fairly-well written book considering he dedicated one chapter explaining how he is a recovered addict, turned his life around and became a multi-millionaire. Personally, I think the Grant Cardone is a super bright person and he still has some serious flaws, but one thing he preaches very heavily is the difference in profits earned purchasing multi-unit properties vs. single family.

The one main thing that Grant Cardone does not teach is how to do the simple math that the BP calculator does and the math similar to the images I posted.

I will say this over and over and I would like for you to prove that Blackstone made the right decision and I would like for you to prove that I am wrong in regards to anything I write. I'm betting tire of saying the same thing over and over and I love the challenge. I've been writing on many forums for many years and I always say that I will prove the accuracy for what I write and I will apologize when I make a mistake.

Please! Can some expert show me the proof where you can earn even close to the same money with single family homes as you can with multi-unit properties. I showed you my number and now show me some proof that I am wrong.

I wrote on a contractor forum for many years and some members kept writing posts saying that my plumbing company did not make the money I claimed in my posts. So, two members from the forum came to my business and as soon as I showed them one bank statement and my customer list database where we could pull up all the sales for one month they didn't want to see any more and they wrote several positive posts about the claims in my posts.

When I write that I made $34 million plus $2.4 million = $3.6 million between 2001 and 2021 with a little more than $2.2 million in cash then I guarantee you that I can back up that claim with a list of my assets and a few tax records. But...the serious issue here is not in regards to whether or not I am full of b.s.. The real issue is about proving through the math whether or not multi-unit properties can really generate $36.4 million in profits vs. investing that same amount of money in single family properties between 2001 and 2021 where I am ready to prove that if you went the single family route it is very likely that even though housing prices are rising like crazy I don't think most houses prices have recovered to above their price before 2001, meaning investors who invested in single family homes with $2.1 million would have lost money, or if prices did rise above 2001's prices they did not rise much while multi-unit properties were doubling in price every year for several years.

Just a few of the properties I own and their appreciation since 2001

Purchased 28 homes in Las Vegas between 2008 and 2010 at auctions for 30 cents on the dollar. I gifted 6 to my children still have two and sold 20 homes and netted $3.5 million. So, if you add the 6 I gifted plus the two I still own then my total profit for the 28 homes is probably about $4.5 million.

Purchase 28 units in 2001 for $1,950,000. Value today is 28 X $320,000 per unit = $8,960,000 plus the properties are paid off and my cashflow is currently about $45,000 per month after expenses, but when I had a mortgage two years ago I my cashflow was still more than $100,000 per year. So if we take an average of $70,000 per year for cashflow in 20 years I netter $8,960,000 - $1,950,000 = $7,010.000 plus 20 years of cashflow = 20 x $70,000 = $1,400,000 + $7,010,000 = $8,410,000 or I earned 431% on the total amount I paid for the property plus a lot of other tax benefits.

Show me a house that you can purchase today and where you actually can manually control the amount of money where you can increase the single family home 4 times the price you pay in 20 years. You cannot purchase a single family home and do any sort of math projections where you have the control to make that home worth 4 times what you paid in 20 years, but it is very easy to find multi-units, TODAY, where the math will prove that the buyer will earn 4 times the price he pays for the property.

I sort of started  in the real estate business in 1963 when I was 13-years old because I was working for a Jewish family that owned half the city in Springfield and Holyoke Massachusetts. This family took me under their wing, armpits, or whatever and they owned several very large apartment buildings, 25 movie theaters, commercial high-rise buildings and single-family homes.

The richest people in the U.S. own multi-unit properties and commercial buildings.

Send me more information about why Blackstone buys single family homes and send the math. I don't believe they are turning a profit and there are a lot of very large companies operated by some serious screwballs. Tell me what happened to that company that had some screwball business model where they were buying thousands of single family homes without looking at them, or something like that. Last I heard they went bust and had they had the same business model to buy multi-units without looking at them I would give them 100$ of my sort to say they could have purchase any multi-unit with blindfolds because just a few years ago, multi-unit properties were doubling in value every year. What a shame and waste that they didn't have the brains to look at multi-units. They would probable be trillionaires, today and they could have used the exact same amount of investment capital.

I did a little research and your claim about Blackstone purchasing single family home to hold is not correct. Blackstone purchased Home Partners of America Inc. and Home Partner of America's business model is not to buy and hold single family homes. Their business model is to buy homes, rent them and make some type of financial arrangement to sell the homes to the tenants and somehow make the homes more-affordable for the tenants to buy.

@Jack Orthman I’m assuming you write your post on a laptop, because you write a book. LOL

My question is how does someone get into the multi family? I have been purchasing single family for years , because a solo operator can do so due to the lower bar of entry.

I sincerely would like to enter multi  family, but somehow have just have not cracked the code. I think that’s where other people are as well. There’s so much competition for multi family as well..

There’s people on Bigger Pockets posing as experts that are really trolling for money for their  syndications. One person reached out to me and we had a phone conversation and they was shopping  to see how much money I had to lend. Then they offered To let me be a part of their Facebook group for $10,000. I told them I needed  to talk to my wife. LOL

Right now if I had to choose I'd put my money on industrial. It seems everyone needs mini storage units and there are still some old empty facilities sitting around. Best part is you don't have to worry about tenants, water or sewage issues. 

Originally posted by @Joe S. :

@Jack Orthman I’m assuming you write your post on a laptop, because you write a book. LOL

My question is how does someone get into the multi family? I have been purchasing single family for years , because a solo operator can do so due to the lower bar of entry.

I sincerely would like to enter multi  family, but somehow have just have not cracked the code. I think that’s where other people are as well. There’s so much competition for multi family as well..

There’s people on Bigger Pockets posing as experts that are really trolling for money for their  syndications. One person reached out to me and we had a phone conversation and they was shopping  to see how much money I had to lend. Then they offered To let me be a part of their Facebook group for $10,000. I told them I needed  to talk to my wife. LOL

All you need to do to start purchasing multi-family properties is go back to the many posts I wrote explaining how to do the math to find the properties that are going to produce the most bang for your buck. The math is simple and even BP has a calculator for multi-family properties but I think my software application is better and you really don't need the software at all once you understand how the math works that shows you that multi-unit properties increase in value almost exponentially only by increasing the rent $30, $40, $50 or more after you purchase the properties.

Go back and read the many posts I wrote regarding multi-unit properties. I also purchase single family properties when I can earn 50% to 100% on my money within 1 year and that is very simple to do, but you made need to go further back into my many posts and earning what I say is very simple to do. I firmly believe that most investors who don't invest as I explain is because these people have been brainwashed to believe a person has to have some special education or something special they don't have and these people cannot vision themselves being that successful and that filthy rich. So, they don't even bother to try and stick with stinky single family homes because that is what everyone else is doing and that makes them feel safe.

There is nothing special you need to know with the exception of learning the 5th grade math and changing your business model and mindset. 

The only difference between doing the math for either single family properties or multi-family is the business model you write on paper, or just keep in your head. If you don't have a definitive business model then you are investing with a blindfold.

You need to go back and read my posts to see all the math, charts and philosophies that can (or will) make you millions of dollars  in a short period. The business model is; when you are looking for either single-family or multi-unit properties you are searching for properties that fit this criteria. You are searching for properties were you can double the amount of capital you invest every 1 to 1 years. Put another way, you want to earn a 50% to 100% return on your money every year. While this appears to be an unreasonable goal it is very possible and simple to do when you have planted that business model in your head and you cannot achieve a 50% to 100% return on your money every year if you do not plant the business model in your head.

The reason it is simple to earn 50% to 100% on your money every years is because before you had this business model you never did the proper math and you did not know what you was looking for, but when you know the math and you know what you are looking for it is this simple.

I will tell you where I find properties and I never found one on zillow, loopnet nor any other online website. I find almost every property by personally vising brokers at their office and ask for listings for multi-unit properties. In one week. By calling and visiting brokers at their offices in one week I can find more than 100 listing and pocket listings for multi-unit properties that are not listed on MLS, zillow, loopnet. etc., Pocket Listings are properties for sale that are only in the broker's pocket so-to-speak and these properties are not listed on MLS, zillow, loopnet, etc.) and after I visit a few brokers I will start to get many calls for multi-unit properties that are for sale.

This is what happened when I visited a few brokers. A few weeks later, a broker called and asked my how much a 14-unit property on Vermont Avenue in Gardena California was worth. He did not give be the address and I asked him if he was talking about the 14 units on the corner of 161st Street and Vermont Avenue. He was surprised and asked how I knew the address. I told him that I had looked at just about every multi-unit property and there was only one 14 unit on Vermont Avenue.

At the time, I was absolutely positive that apartments were selling for $100k per door, but I told him the 14 doors was worth $800k. The next day he called and said the seller would sell it for $825k and I said sold. Did I meet my business model where I earned 50% to 100% on my money. I put $200k down to purchase the building for $825k. The day the building closed escrow it was worth $1.4 million. So, I earned 300% on my money in 1 day and that is what you need to look for. At least, you need to look for 50% to 100% in one year or keep your money in your pocket until you do. I purchased that property in 2004, paid off several years ago. My rent income is $21,000 per month and I net about $200k after taxes and all other expenses. Today, the building is worth $320k per door, or $ 4,480,000 plus $200k I earn every year from cashflow. So, average the cashflow to about $150,000 for the past 17 years and in the past 17 years I earned $4,480,000 - $825 = $3,655,000 + 17 years x %150,000 per year for cashflow = $6,205,000. I know the calculations are not exactly accurate, but I hope you get the idea. Where can you earn $6,205,000 with a $200k down payment. NOT WITH SINGLE FAMILY HOMES! Suppose, I used the $200k to purchase a single family home in 2004. I think I would probably have lost money because I don't think the value of homes increase to above what they were after the 2008 to 2010 bubble popped. I know I would not have earned $6 million.

Read my previous posts for more information. I've had a serious sciatic pain for the past 8 weeks and I sleep only 2 to 3 hours every day and that is why I've been on BP 24/7.  I am actually getting delirious to the point I will write everyone to death and am afraid that I will get to a point where I'm not being clear, or not making any sense.

I think I will take a break for a few days, but I've already said everything you need to know about a hundred times and you should go way back for some critical information.

Originally posted by @Dallas Hayden :

Right now if I had to choose I'd put my money on industrial. It seems everyone needs mini storage units and there are still some old empty facilities sitting around. Best part is you don't have to worry about tenants, water or sewage issues. 

One problem with mini-storage is the cost to have employees both provide counter service and to watch over the property 24/7 365 days per year and someone needs to be on the property all these hours, or your units will get broken into and then you will be in hot water.

While you save on water, sewers and a hundred other issues you have to deal with when dealing with dwellings, you have several expenses for damage to the rollup doors, driveway paving that is super expensive, flooding inside storage spaces during major down pouring of rain, 24/7 security problems and costs due to the fact that scumbags jump fences and break into the storage units because they know people store very valuable items, leaking roofs, damaged rollup doors, dealing with people who don't pay their monthly fees and you have a lot of legal issues regarding how you have to dispose of their items by sending proper legal notices and then you have to auction the items.

Originally posted by @Jack Orthman :
Originally posted by @Michael Plante:
Originally posted by @Jack Orthman:

Investing in multi-unit properties even as small as 4 units. It seems like millions and millions of investors have their heads buried in the sand and they have single family homes burned deep into their small brains. I seriously want to punch brokers who tell me you can make as much with single family homes as multi-unit properties and I will challenge any real estate broker or investor, any day. and that is no b.s. nor joke. Bring it on! I love a good argument.

 Very interesting

any guess why Blackstone chose to buy 6 Billion dollars worth of SFH to rent out VS buying multifamily?

Sorry! I disagree 100% and would like for you to tell me why Blackstone purchase $6 million worth of single family homes.

I won't use the word 'perhaps'. I will bet that Blackstone would have been better off purchasing multi-unit properties.

The book 'Be Obsessed or Be Average' written by Grant Cardone is actually a fairly-well written book considering he dedicated one chapter explaining how he is a recovered addict, turned his life around and became a multi-millionaire. Personally, I think the Grant Cardone is a super bright person and he still has some serious flaws, but one thing he preaches very heavily is the difference in profits earned purchasing multi-unit properties vs. single family.

The one main thing that Grant Cardone does not teach is how to do the simple math that the BP calculator does and the math similar to the images I posted.

I will say this over and over and I would like for you to prove that Blackstone made the right decision and I would like for you to prove that I am wrong in regards to anything I write. I'm betting tire of saying the same thing over and over and I love the challenge. I've been writing on many forums for many years and I always say that I will prove the accuracy for what I write and I will apologize when I make a mistake.

Please! Can some expert show me the proof where you can earn even close to the same money with single family homes as you can with multi-unit properties. I showed you my number and now show me some proof that I am wrong.

I wrote on a contractor forum for many years and some members kept writing posts saying that my plumbing company did not make the money I claimed in my posts. So, two members from the forum came to my business and as soon as I showed them one bank statement and my customer list database where we could pull up all the sales for one month they didn't want to see any more and they wrote several positive posts about the claims in my posts.

When I write that I made $34 million plus $2.4 million = $3.6 million between 2001 and 2021 with a little more than $2.2 million in cash then I guarantee you that I can back up that claim with a list of my assets and a few tax records. But...the serious issue here is not in regards to whether or not I am full of b.s.. The real issue is about proving through the math whether or not multi-unit properties can really generate $36.4 million in profits vs. investing that same amount of money in single family properties between 2001 and 2021 where I am ready to prove that if you went the single family route it is very likely that even though housing prices are rising like crazy I don't think most houses prices have recovered to above their price before 2001, meaning investors who invested in single family homes with $2.1 million would have lost money, or if prices did rise above 2001's prices they did not rise much while multi-unit properties were doubling in price every year for several years.

Just a few of the properties I own and their appreciation since 2001

Purchased 28 homes in Las Vegas between 2008 and 2010 at auctions for 30 cents on the dollar. I gifted 6 to my children still have two and sold 20 homes and netted $3.5 million. So, if you add the 6 I gifted plus the two I still own then my total profit for the 28 homes is probably about $4.5 million.

Purchase 28 units in 2001 for $1,950,000. Value today is 28 X $320,000 per unit = $8,960,000 plus the properties are paid off and my cashflow is currently about $45,000 per month after expenses, but when I had a mortgage two years ago I my cashflow was still more than $100,000 per year. So if we take an average of $70,000 per year for cashflow in 20 years I netter $8,960,000 - $1,950,000 = $7,010.000 plus 20 years of cashflow = 20 x $70,000 = $1,400,000 + $7,010,000 = $8,410,000 or I earned 431% on the total amount I paid for the property plus a lot of other tax benefits.

Show me a house that you can purchase today and where you actually can manually control the amount of money where you can increase the single family home 4 times the price you pay in 20 years. You cannot purchase a single family home and do any sort of math projections where you have the control to make that home worth 4 times what you paid in 20 years, but it is very easy to find multi-units, TODAY, where the math will prove that the buyer will earn 4 times the price he pays for the property.

I sort of started  in the real estate business in 1963 when I was 13-years old because I was working for a Jewish family that owned half the city in Springfield and Holyoke Massachusetts. This family took me under their wing, armpits, or whatever and they owned several very large apartment buildings, 25 movie theaters, commercial high-rise buildings and single-family homes.

The richest people in the U.S. own multi-unit properties and commercial buildings.

Send me more information about why Blackstone buys single family homes and send the math. I don't believe they are turning a profit and there are a lot of very large companies operated by some serious screwballs. Tell me what happened to that company that had some screwball business model where they were buying thousands of single family homes without looking at them, or something like that. Last I heard they went bust and had they had the same business model to buy multi-units without looking at them I would give them 100$ of my sort to say they could have purchase any multi-unit with blindfolds because just a few years ago, multi-unit properties were doubling in value every year. What a shame and waste that they didn't have the brains to look at multi-units. They would probable be trillionaires, today and they could have used the exact same amount of investment capital.

Amy, 

I don't know any underappreciated opportunity in this market.  We own SF, MF and small apartments.  The SF operated the best during COVID and has always been my favorite.  If I were to follow my next shiny star it would be senior housing, I think the opportunity is available almost anywhere and as the population ages it will be a very good commodity for the next 15-20 years.

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There's a big opportunity not here yet, but on the way. It's all the newbie real estate investors. Especially those investing OOS. In a market down turn large numbers of them are going to get hurt and sell at bargain prices 

@Eric James

That's a great point!  A friend of mine pointed out to me the other day that many of the big "celebrity" investors have started to focus on real estate education. (Maybe this isn't new...) There is a huge audience for this right now.  Everyone wants to be an investor, and unfortunately many will fall prey to scams or make bad property buying decisions.

@Amy Raye Rogers

The best returns are usually on the value add opportunities if they go well.

If you buy in all cash and renovate you have a brand new property with a top notch product. Your rehab should include all new mechanicals.

When this is done correctly you end up with the best product on the market for a rental and you control your two biggest variable expenses in CapEx and maintenance.

Originally posted by @Jack Orthman :
Originally posted by @Joe S.:

@Jack Orthman I’m assuming you write your post on a laptop, because you write a book. LOL

My question is how does someone get into the multi family? I have been purchasing single family for years , because a solo operator can do so due to the lower bar of entry.

I sincerely would like to enter multi  family, but somehow have just have not cracked the code. I think that’s where other people are as well. There’s so much competition for multi family as well..

There’s people on Bigger Pockets posing as experts that are really trolling for money for their  syndications. One person reached out to me and we had a phone conversation and they was shopping  to see how much money I had to lend. Then they offered To let me be a part of their Facebook group for $10,000. I told them I needed  to talk to my wife. LOL

All you need to do to start purchasing multi-family properties is go back to the many posts I wrote explaining how to do the math to find the properties that are going to produce the most bang for your buck. The math is simple and even BP has a calculator for multi-family properties but I think my software application is better and you really don't need the software at all once you understand how the math works that shows you that multi-unit properties increase in value almost exponentially only by increasing the rent $30, $40, $50 or more after you purchase the properties.

Go back and read the many posts I wrote regarding multi-unit properties. I also purchase single family properties when I can earn 50% to 100% on my money within 1 year and that is very simple to do, but you made need to go further back into my many posts and earning what I say is very simple to do. I firmly believe that most investors who don't invest as I explain is because these people have been brainwashed to believe a person has to have some special education or something special they don't have and these people cannot vision themselves being that successful and that filthy rich. So, they don't even bother to try and stick with stinky single family homes because that is what everyone else is doing and that makes them feel safe.

There is nothing special you need to know with the exception of learning the 5th grade math and changing your business model and mindset. 

The only difference between doing the math for either single family properties or multi-family is the business model you write on paper, or just keep in your head. If you don't have a definitive business model then you are investing with a blindfold.

You need to go back and read my posts to see all the math, charts and philosophies that can (or will) make you millions of dollars  in a short period. The business model is; when you are looking for either single-family or multi-unit properties you are searching for properties that fit this criteria. You are searching for properties were you can double the amount of capital you invest every 1 to 1 years. Put another way, you want to earn a 50% to 100% return on your money every year. While this appears to be an unreasonable goal it is very possible and simple to do when you have planted that business model in your head and you cannot achieve a 50% to 100% return on your money every year if you do not plant the business model in your head.

The reason it is simple to earn 50% to 100% on your money every years is because before you had this business model you never did the proper math and you did not know what you was looking for, but when you know the math and you know what you are looking for it is this simple.

I will tell you where I find properties and I never found one on zillow, loopnet nor any other online website. I find almost every property by personally vising brokers at their office and ask for listings for multi-unit properties. In one week. By calling and visiting brokers at their offices in one week I can find more than 100 listing and pocket listings for multi-unit properties that are not listed on MLS, zillow, loopnet. etc., Pocket Listings are properties for sale that are only in the broker's pocket so-to-speak and these properties are not listed on MLS, zillow, loopnet, etc.) and after I visit a few brokers I will start to get many calls for multi-unit properties that are for sale.

This is what happened when I visited a few brokers. A few weeks later, a broker called and asked my how much a 14-unit property on Vermont Avenue in Gardena California was worth. He did not give be the address and I asked him if he was talking about the 14 units on the corner of 161st Street and Vermont Avenue. He was surprised and asked how I knew the address. I told him that I had looked at just about every multi-unit property and there was only one 14 unit on Vermont Avenue.

At the time, I was absolutely positive that apartments were selling for $100k per door, but I told him the 14 doors was worth $800k. The next day he called and said the seller would sell it for $825k and I said sold. Did I meet my business model where I earned 50% to 100% on my money. I put $200k down to purchase the building for $825k. The day the building closed escrow it was worth $1.4 million. So, I earned 300% on my money in 1 day and that is what you need to look for. At least, you need to look for 50% to 100% in one year or keep your money in your pocket until you do. I purchased that property in 2004, paid off several years ago. My rent income is $21,000 per month and I net about $200k after taxes and all other expenses. Today, the building is worth $320k per door, or $ 4,480,000 plus $200k I earn every year from cashflow. So, average the cashflow to about $150,000 for the past 17 years and in the past 17 years I earned $4,480,000 - $825 = $3,655,000 + 17 years x %150,000 per year for cashflow = $6,205,000. I know the calculations are not exactly accurate, but I hope you get the idea. Where can you earn $6,205,000 with a $200k down payment. NOT WITH SINGLE FAMILY HOMES! Suppose, I used the $200k to purchase a single family home in 2004. I think I would probably have lost money because I don't think the value of homes increase to above what they were after the 2008 to 2010 bubble popped. I know I would not have earned $6 million.

Read my previous posts for more information. I've had a serious sciatic pain for the past 8 weeks and I sleep only 2 to 3 hours every day and that is why I've been on BP 24/7.  I am actually getting delirious to the point I will write everyone to death and am afraid that I will get to a point where I'm not being clear, or not making any sense.

I think I will take a break for a few days, but I've already said everything you need to know about a hundred times and you should go way back for some critical information.

You wrote 493 post. I probably wouldn’t have the time to go through each one looking for the one he was referring to. Could you do a couple links to the most recommended ones?

@Jack Orthman I won't argue against your results, but I would take the bet that financing terms for all of Blackrocks recent SFH transactions (purchased at scale neighborhood by neighborhood) are vastly superior to any financing you or I have ever gotten, and since their cost of capital is so comically close to zero, that they're making money on these acquisitions hand over fist.

Originally posted by @Nick Barlow :

@Jack Orthman I won't argue against your results, but I would take the bet that financing terms for all of Blackrocks recent SFH transactions (purchased at scale neighborhood by neighborhood) are vastly superior to any financing you or I have ever gotten, and since their cost of capital is so comically close to zero, that they're making money on these acquisitions hand over fist.

The question was really whether or not Blackstone is purchasing single family homes because vs. multi-unit properties because Blackstone thinks purchasing single family homes is more prosperous and it turns out that Blackstone purchases homes to Rent To Buy.

As for Blackstone making a profit, I suppose it is possible since while they are holding the homes to sell them they are bringing in some cash to may to maintain the property taxes and other expenses. I've been to several seminars that tried to hawk the idea that there is a lot of side profits made when you rent homes to tenants to buy and there are an abundance of inherited risks. I am wondering if they are charging the buyers some absurd interest and other fees since most-likely all the buyers have low credit scores and everyone knows those people pay higher interest rates due their risk factor. I am guessing that Blackstone is charging the going interest rate plus at least another 2%.

The side profits are sometimes earned when tenants sign a contract to Rent To Buy, the tenant pays a substantial non-refundable deposit and then backs out of the purchase and the seller gets to keep $10,000 or $15,000. I actually think that is fair because when I clean a house after a tenant moves my average cost is $6,000 to $8,000, sometimes $12,000 and I cleaned a house in Idaho and after repairing all the damage my exact cost was $18,000, but I broke the price down the same as if my company did the job for a customer and that came out to $32,000. The tenants destroyed every plumbing fixture, broke all the bathroom sinks, destroyed the kitchen cabinets, granite counter tops and the filth and destruction brought tears to my eyes when I first walked in.

The special risks are; tenants figure they are buying the property and it belongs to them so they can do whatever they want to do. In a short time the tenants tear down walls, hire shoddy contractors and the tenants don't have the cash to pay the contractors. Then, the contractors sue the tenants and the property ends up with Mechanics Liens. Even if Mechanics liens are not files the seller may end up paying $20,000 to $50,000 to put the house back together.

I had that exact same problem when I signed a Lease Option to purchase 7-1/2 acres with a 2,000 sq ft house. The entire parcel of land was 17-1/2 acres and the seller told me the county had already approved the land split.

My purchase price was $225,000 and I gave the seller $100,000 and started remodeling the house. When the seller saw the walls I tore down he filed a lawsuit that stated that I destroyed the house and he could not get a loan against the house. Well...if he sold the house to me then he was not qualified to take $100,000 from me and then have a mortgage company file a 1st or 2nd Trust Deed on the property. So, I kept giving the seller money until I paid him the entire $225,000 and it took exactly 5 years to the last day and cost me $50,000 for attorney fees. I won the case, but what the judge awarded me was the right to purchase the other two parcels of land for $60,000 each and that is what I did.

@Michael Plante

Blackrock purchased sfh for a few reasons.

1) easy to model the costs and rents

2) supply is larger

3) they can corner the rental market in certain neighborhoods

It's relatively easy to model model the costs of a post 1980 sfh and easy to model the rents.

If your looking to spend billions it's hard to find enough small multifamily to satisfy that demand, also they are usually older which makes estimating costs harder.

It's simple to just buy most of the available homes in a certain neighborhood that are good rentals with billions of dollars. Once you own the supply of rentals In a neighborhood you can to a large extent participate on price fixing due to your small regional monopoly.

And as an added bonus, it's a good inflation hedge against the trillions of dollars of other investments you've made.

Originally posted by @Jeremy Komer :

@Michael Plante

Blackrock purchased sfh for a few reasons.

1) easy to model the costs and rents

2) supply is larger

3) they can corner the rental market in certain neighborhoods

It's relatively easy to model model the costs of a post 1980 sfh and easy to model the rents.

If your looking to spend billions it's hard to find enough small multifamily to satisfy that demand, also they are usually older which makes estimating costs harder.

It's simple to just buy most of the available homes in a certain neighborhood that are good rentals with billions of dollars. Once you own the supply of rentals In a neighborhood you can to a large extent participate on price fixing due to your small regional monopoly.

And as an added bonus, it's a good inflation hedge against the trillions of dollars of other investments you've made.

 Fantastic helpful answer 

Much appreciated 

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