All Forum Posts by: Chihiro Kurokawa

Go to as many events as you can and if your deal is in fact a good one, you should be able to find an experienced investor willing to partner with you. Based on what you're describing it may just be a JV between you and them.

I'm personally not a fan of zero leverage. If you practice sound asset protection such as solid insurance coverage plus series LLCs or using trusts in conjunction with LLCs you're OK on the liability front. The challenge is determining what leverage suits one's risk tolerance and market dynamics. That may be more art than science, which is why I don't like seeing the word "conservative" in investment packages. I think it's amateurish and meaningless because my definition of it differs from yours. 

 Ha, you're right Javier! Thanks for pointing that out. 

Congratulations Marty on going from 0 to 4 using no debt! 

I'm going to make some assumptions here for simplicity. Your target cash flow number is $120k/year and you're cash flowing $4000 per month. You bought each property for 100k.

If you intend to continue your no-leverage strategy you'd need 87 more properties to reach $120k/year. Assuming you maintain your pace of 3 property purchases per year you'll hit 120k/year in 29 years. This assumes you will have come up with $8.7 million to buy those houses. 

There is an outstanding out-of-print book out there called Equity Happens which I think you should read. It's the first real estate book I read and it changed my life. The caveat is that it was written in the days before the big crash of 2009-2010 and it only talks about the upside of leverage, ignoring the downside. 

I assume you don't need an explanation of the downsides since you went full Dave Ramsey for your first three properties. I believe that debt with reasonable term length, rate and covenants/restrictions is necessary to scale in real estate. But if you're risk averse, there's nobody holding a gun to your head to take max leverage. Why not take just 60% on your SFRs for peace of mind? The banks would be happy to provide it. 

For me, after strongly considering SFRs I just couldn't see a way to hit my annual income goal without massive logistical challenges so I decided to go the apartment route. It is pretty difficult to find a deal that works given current conditions and how conservative I am, but after two years of searching I was able to do it. 

I'm leery of short-term loans by which I mean terms of 7 years or less. Unless it is a distressed or heavy value-add deal, a short term loan gives up far too much in disposition flexibility in exchange for leverage. Even if there is a ton of upside, I would be unlikely to invest right now in a deal with short term debt. 

Hi @Anthony Cecena

I'd encourage you to go to more than one event as there are big differences across them. As a disclosure, I'm a member of Think Multifamily but I'm not paid by them - I'm simply a very satisfied member. 

It has been exactly two years since I decided to pursue multifamily. However about 15 months of that was spent trying to get it done on my own and that was not fruitful. During that time I went to a live seminar over two days and just couldn't get myself to pull the trigger on it, though I got VERY close. I didn't like how the focus seemed to be so much about money being made by the mentor and by his students. Maybe you are different but it doesn't motivate me to see a guru talk about his car, homes etc. I just don't see how another man's stuff is relevant to my success.

Obviously there's money in real estate, but the money is a tool/bridge/means to having more control over my life. I have specific personal goals I want to achieve and they have to do with my wife and I having more control over our lives; none of my goals are about possessions. Those things will simply come along the way. 

When I meet real estate investors I look at them to see if I am philosophically in sync with them. I've found such people in the Kenneys who founded Think Multifamily, and also in the members of the group. So I love that and the sense of family within the group. It's like any company or sports team; the tone is critically important and it is set at the top.

Oh and most importantly as a person evaluating such a group you need to know about track record - you can just google Mark Kenney, he's done thousands of doors. I've got a 100+ unit deal in escrow along with 15-20 deals closed or currently under contract by other Think Multifamily members since October 2017. 

Good luck on your journey! 

@Adam Kessler somehow I missed your first response - that is very helpful, thanks for your input.