Get Into the Multifamily Real Estate Race and Beat the Competition
You’ve just spent a few years investing in single family homes, and you believe you’re ready to try your hand at multifamily properties. With the right preparation, you should be successful in your new venture. Before you jump into this type of real estate, take some time to put together a plan in order to maximize your success.
While spending time online to find potential investment properties may seem like a good idea, its value is limited. One of the best ways to acquire property is to visit neighbors and tour properties. Speak with investors and commercial brokers. Talking to professionals will help you find out the best areas for you to invest your money. Don’t limit yourself to one or two markets; view at least one-half dozen markets before you make a decision on where you would like to invest.
When you consider investing in multifamily properties, you need to make sure you have enough funds in the bank to cover the costs of whatever comes your way. You need to be prepared for unexpected events; for example, your heating system to a couple of units could break down after you purchase the property. Also, you should not assume each unit will always have a tenant. There are sure to be times when there is a vacancy or a couple of vacancies in the building. Real estate experts recommend to look at your expenses and see if 50 percent of the renters would pay your bills. If that’s not the case, you would need to have cash flow from another area to help with expenses.
Breaking into this type of real estate market requires networking skills. Take time to speak with anybody you know that has been successful in residential real estate. When you are venturing into this type of investing for the first time, it is important to gain mentors, who will be able to point you in the right direction when you have questions.
Success in real estate happens when you have experience and when you are surrounded by professionals who are able to assist you when you have questions. If you’ve had success in renting and selling single family homes, this might be a good time for you to invest in multifamily properties. Before you make an offer on a property, it’s important to have your research completed and extra cash set aside for an unexpected expense. If you feel comfortable in these areas, then you are ready for this type of investing.
