All Forum Posts by: Andrew Hogan

@Nav Madhwan I'm not a CPA, but I do know of several people who traded up their smaller properties for a portion of a larger MF deal and, in turn, got the same effect of a 1031 because of Cost seg, bonus depreciation, and accelerated depreciation. They just had to reinvest within a calendar year.

@Jared Friedman I'm not a CPA, but I do know of several people who traded up their smaller properties for a portion of a larger MF deal and, in turn, got the same effect of a 1031 because of Cost seg, bonus depreciation, and accelerated depreciation. They just had to reinvest within a calendar year. 

Great responses so far. I think your first step @Stephanie Yi is to educate yourself thoroughly on different passive investments that produce consistent income. From there you'll need to learn how to evaluate managers/sponsors of those types of assets. Doing this will greatly reduce your risk of losing capital. Mitigation of that risk should be your chief aim!

Happy Hunting!

Hey Jacob, like the others said you've got to know the market wherever you go. Ideally, you start in your backyard but if you do enough research and don't mind the 4-hour drive to Vegas every once in a while, I'd definitely choose that. I think that the "next sucker" can be found anywhere someone throws money into something they don't know enough about. 

Perhaps try investing alongside someone with expert knowledge first, then with that education, you can trust your abilities to invest by yourself and you'll be the one answering questions.

Yes, FHA loans are great, there are similar rates depending on the institution for

owner-occupied financing options

@Marcos Paulo Cerra is right. You should be able to get it for 3.5% with an FHA or similar package.

Perhaps a keyword to mention next time is "

"owner-occupied financing" and mention that it isn't strictly for investing but also to live in (at least for a year).

@Kayla V. I know that we have everything you mentioned ;)

Great question Kayla, it can be a tricky business to vet.

I always advise that people do their research when it comes to sponsors and deals. When you’re considering an investment sponsor, do due diligence. Keep in mind to always:

• Ask for references: Email references and set up a time to call them. Ask some open-ended questions and find out what they have to say about the sponsor.
• Look at the team: Is the sponsor a one-man show? If there’s a team, what do they bring to the table?
• “Stalk” the sponsor online: Do some basic internet searches. If you’re not finding much about the sponsor, that could be a red flag.

Hey everyone, looking forward to getting together! Looks like there is a variety of people here who can bring different perspectives to the table.

Good question Clark, it depends what your personal goals are. Do you care more about current cash flow, or growing your wealth bucket longterm? Typically more experienced MF syndicators will give you a lower initial preferred return of  6-7% while they give you a better backend of 70-75% when the asset refis or exits. Then you'll usually see lesser experienced or sponsors with heavier value-add deals give you a higher initial preferred return but only give the LP 50-60% on the backend. 

That being said, the preferred return isn't guaranteed, so what makes the most sense is the sense you make of the sponsor.