All Forum Posts by: Neil Henderson

Margins have tightened quite a bit in recent years. Total returns in the 20-25% range going to the LP's for a value-add deal on an existing multifamily property would give me pause. Not impossible, but I'd prefer a sponsor under promise and over deliver, especially right now. Those kinds of returns are more typical of a development deal right now, as @Greg Dickerson stated.

Sponsors are typically making money on the buy side with acquisition fees and on the sell/refi side. Most of the cash flow is typically going to the LP's, not the GP's. I wouldn't say GP's are usually making more money than the LP's, unless you are looking at straight Cash on Cash return, even then, most of the good sponsors I know invest in their own deals. That shows an additional alignment of interest. Not a deal breaker if they don't, but It will DEFINITELY make me inquire as to why.

Have you run any numbers through AirDna.co? That would be where I would start.

Was this in Fayetteville, NC or Fayetteville, AR?

Deal Machine.

Are you contemplating a live-in flip? @Mindy Jensen would be the one to talk to about those. 

If it's not an owner occupied unit I would urge caution against proceeding until you are better capitalized to handle the purchase and the rehab in short order. Unoccupied real estate is often hard to insure and can quickly attract a bad element. It might not seem like a big deal to have a property sitting vacant with no debt, but it can certainly end up taking money out of your pocket.

I subscribe to the school of thought that you should invest where it makes sense and vacation where you want to. I love Mexico and numerous other international destinations, but as an investment, I'd rather have my investments closer to home where I feel a little more control and comfort with the local government. 

I'm sure there are people making great money running short term rentals in exotic locations around the globe, but there's too much uncertainty for my taste.

We use Personal Capital for a rough estimate and then I just use a spreadsheet to get a little more detailed. 

Congratulations! Love this! Not a day goes by that I don't wish small multifamily properties were a viable investment strategy in Las Vegas.

I would say start with evaluating what it is that you can bring to the table. The three major things are Time, Money or Experience. Find someone who lacks one of those things and see if you can provide what it is they lack. You're young and lacking experience in real estate, so I would venture to guess you probably have time, maybe money, I don't know. Get out there and meet investors in your local area and find a way to add value to them without expecting anything in return initially (unless you're investing your money, LOL). 

If you have time, but no money or experience, give them your time. Bird dog for deals. Analyze deals. Help them with their marketing.

If you have money, but no time or experience, give them your money. AFTER you have established a relationship with them and you know, like and trust them. 

Find a way to start small and just get started. Over analyzing it and hoping to "Go big and go fast" will leave you spinning your wheels for months...or years.

Good luck!

@Josue Vargas The funny thing is, we've had several people book with us over the last 3 weeks who wanted to stay in a house instead of a hotel to avoid being around more people. Weird unintended consequences seem to be the norm.