All Forum Posts by: Zachary Ware
Zachary Ware has started 6 posts and replied 399 times.
Post: Is small multifamily <5 units a good opportunity in 2023 and beyond
- Posts 405
- Votes 455
The best market to invest in 2-4 units is the market you live in. Doing a househack with FHA is a great entry point and in my opinion one of the safest options you have. You are there at the property and know what is going on with the neighborhood. The second best is a city with a growing population and diversity on the economic side as well such as having multiple big employers who are in different industries. I think the southeast is still a great area to focus on.
Post: Tenet complaining about Ants
- Posts 405
- Votes 455
Does your lease state who is responsible for pest control?
Post: Syndication pros and cons
- Posts 405
- Votes 455
Quote from @Spencer Gray:
This is just a quick list off the top of my head
Pros -
- Access to opportunities that you couldn't undertake by yourself
- Ability to diversify across multiple commercial assets
- Profesional management
- Larger deals offer better economies of scale and have superior financing
- Completely passive investment besides initial due diligence on sponsor and deal
- Ability to diversify across different sponsors, markets and asset classes
- Scalable strategy
- No personal guarantees for debt
Cons -
- You are not "in control" of the deal
- Bad/inexperienced sponsor can ruin a good deal
- You do not receive all of the upside, a portion is split with sponsor
- Difficult to 1031 exchange
- There are fees charged to the deal
- The wrong structure can create unaligned interests
It's more important to vet a sponsor than a particular deal. You're picking your race horse, not necessarily the track, although you can have your say in that as well.
You want to find a group that has goals that align with yours and pursuing the types of projects that you are interested in. Experience is key, ask about their worst deals not just their home runs.
Great breakdown and overview! Make sure you are not just taking the GPs numbers but running your numbers as well. Stress test the deal and especially the assumptions.
Post: Risks of Owning a Multi-family building
- Posts 405
- Votes 455
I would add to this lack of diversification. I recently heard of a fire that was started in an apartment complex and burned down the entire building with the owner losing 10+ units. Concentration can have its advantages such as economies of scale and market knowledge but there is also the inverse.
Post: should I be concerned with extra people at my property?
- Posts 405
- Votes 455
I agree with Richard on this one. Your tenants signed legally binding contracts (Leases). If there truly are people living there who did not sign leases it could get complicated if anything went wrong (damage, leaving early, not leaving after the lease ends, etc.) I would not think they take on the same legal responsibility as the tenants.
Post: Best Insurance Companies for Investement Properties
- Posts 405
- Votes 455
I have to agree with Cameron. Getting a broker will help you out a lot in the long term as you grow. I have had a great experience with Kin Insurance, Fortress Insurance, and Texas Independent Insurance.
Send me a DM and I'd be happy to review it with you.
Post: Type of insurance 2 Family
- Posts 405
- Votes 455
For a duplex, you can get a rental/landlord policy with liability. Highly encourage you to get at least 6 months of rental loss coverage as well. I believe it will really depend on the carrier used if the house being in an LLC will have a dramatic effect on the insurance.
Post: Looking for advice ....
- Posts 405
- Votes 455
I do not remember the details but I have heard a BP podcast with an investor who did this exact thing. If you can find the episode and reach out, might be great to connect with someone who has experience here.
Post: Duplex Rental Income Calculation
- Posts 405
- Votes 455
I would select duplex on the tool as this is pulling data from comps in the area. You should also look at other sites such as Zillow for comparable properties that are currently for rent. Talked to a good property manager in the area who works with duplexes will likely provide you the most accurate rates.