All Forum Posts by: Rod Khleif

@Ilona Kovacs

Hi Ilona, as others have said Kissimmee is very dependent on the Orlando theme parks and attractions; so a lot of the multifamily houses employees of Disney, Sea World, etc. As a whole the Orlando metro area is stable and growing. To really get a good understanding of the tenant base there I'd suggest getting in touch with some of the local property management companies. They can tell you which submarkets to focus on and which to avoid as well as potentially provide some deals that fit your criteria. Connecting with some great local property management companies will be very beneficial especially if you're investing from out of state.

@Ryan James

Hi Ryan, you'll need to verify with the county, but the quickest way to determine this would be to see if they are both on one parcel or on two separate parcels. If they share the same parcel and property ID number than the county most likely views it as an 8 plex. You can do this via searching the property's address on the county assessor site.

Be sure to confirm this before submitting an offer as the deal will be drastically different depending on if it's commercial or residential.

@Julie N.

Hi Julie  for the most part it all comes down to which method (operating as a triplex or as a fourplex) is producing more rents/income. Did the previous owner combine two units into one because that larger unit would rent for more?

For example, if the property, as a triplex, is producing $2,000 a month, and as a fourplex, would only produce $1,700, why go through the hassle of converting back. The previous owner also may have combined the two units into one due to it having an awkward layout/floor plan. Be sure to take that into consideration as well.  

Hi @Paul LaSpina, as others have said, it's possible, but can be difficult. I wanted to share an experience one of my coaching clients just had to show you that you can get into multifamily deals for very little money down.

He was in a similar position as you and wanted to get into a deal for as little down as possible. Doing that for an on market deal would be tough, so he turned to off market strategies and decided he was going to go the extra mile. He looked up properties on the assessor site, broke down the entities, obtained the owner home address, and then knocked on their door. To be clear, the owners actual home. No call before, no letter; he just showed up and said he also lives in the area and was curious about purchasing their property.

One of these owners, an elderly gentleman, welcomed him in and after several weeks of communication decided to sell his property to my student with 100% owner financing. He is going into the deal putting 0% down!

If you're willing to do what others won't you'll be successful and this is the perfect example of that.  

Hi @Ron Read, if you proceed with the deal you'll need to have everything verified so the seller won't be able to hide whether the property is fully vacant or not for long. If it's the middle of the working day it may be that everyone is gone and that's why there are no cars in the lot. Also, is there a chance that the tenants are utilizing public transportation?

Before making the trip there I'd recommend using Google streetview to get a better feel for the area, addressing your concerns with the broker, and most importantly obtaining financials to confirm whether the property is vacant or not.

Lastly, something to keep in mind is that tenants often take better care of their car than they do of their unit. So if/when you do see the cars in the lot keep that in mind.  

Hi @Daniel J., my biggest piece of advice for you would be to take action and get the ball rolling. If creating an LLC/the entity is all that's holding you back either get that done asap or create the entity after you submit your contract. Once under contract you can assign the property from your personal name into your LLC.

@Brandon Sexton

Hi Brandon, when looking at deals in these smaller markets there are several things you want to consider. A few of the most important are:

1. Employers. Is there one major employer? A small town can quickly go under if the one employer goes out of business or moves. There must be a diverse mix of larger employers.

2. Demand. Small towns of course will not have the demand of the larger markets. Talk to property management companies or brokers that manage and find out what the vacancy rate is in the town. Get local people’s opinion of the rental market. What we do sometimes to test demand is run a sample rental ad on Craigslist and see how many replies it gets. Keep in mind Craigslist may not be the primary marketing method so you may actually need to put "For Rent" signs out on the streets leading up to the property. We have hired “jobbers” on craigslist to do this for us as well.

3. Property management. As others have said there may not be many, if any, property management companies in town. Sometimes you can find brokers that manage as well and some will do a great job for you on smaller properties

@Brandon Sexton

@Rashad Jones Jennings

Hi Rashad, as @Gino Barbaro & @Omar Khan have said sellers are becoming more sophisticated and focusing on broker relationships should be one of, if not your main strategy.

If you want to put some time into direct mail I’d suggest doing whatever it takes to stand out amongst the sea of letters they’re receiving on a weekly basis. Our response rates average 5% and up due to several factors including breaking down the entities that own the properties and mailing the principles at their home addresses, handwriting the envelope, placing a real stamp, etc. Keep in mind these mom and pops often want to deal with other mom and pop buyers so coming off as a genuine, sincere, and serious investor is crucial.

Also, repetition is key. Two to three weeks after sending the letters follow-up with a phone call. Don’t be afraid to try several different methods of communication to get in touch with them.

Hi Kelly , while I don’t currently invest in Omaha I ‘d be happy to give some tips on how to connect with good property management companies in the area. What I’d suggest is locating the top 5 multifamily brokers in that market (via LoopNet, listing sites, etc.) and ask them for a referral.

Tell them what your investment criteria is and that you’re looking to acquire properties over 100 units. You’ll most likely end up hearing the name of the same 1 – 2 companies over and over. Plus you’ll be building rapport with brokers and starting to build those relationships.

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