9 Key Tips For Investing In Apartments and Multifamily Real Estate - Winston Rowe & Associates

9 Key Tips For Investing In Apartments and Multifamily Real Estate ...

#1: Think Big

If buying a 5-unit apartment requires you to get commercial financi...

#2: Don't Choose Apartments by Default

There's nothing wrong with investing in residential apartments per ...

#3: Learn the New Formulas

If you're buying houses, you may use certain formulas, like buying at 75% of After-Repaired Value, minus estimated repairs. Commercial property will have new and different formulas to get used to, such as Net Operating Income and Cap Rates. Learn what is considered good in your area and get familiar with them when making offers.

#4: Be Prepared to Spend More Time at First

Fight the temptation to get discouraged if you haven't done your first deal yet, or if you are spending more time per deal than your previous ones. Houses are so similar that it's easy to make a cookie-cutter system for buying and selling them. “When I begin looking for commercial properties, I was surprised at how long it took me in the beginning to screen deals and make offers” per Dave Lindahl, a real estate guru. Just remember that there is a learning curve, like with anything else, and that things will go faster over time.

#5: Be Prepared to Lose Due Diligence Money

After your offer is accepted, you have a period of time (just like ...

#6: Relationships Are Even More Important

Relationships with other investors, private lenders and consulting firms like Winston Rowe & Associates are important when investing in real estate, but they are even more so when buying commercial properties. For one, properties costing a million dollars or more are probably not within the financial wherewithal of most of us individually, so you probably have no choice but to get to know and work with partners. Also, many commercial properties are sold without being listing first, so the more people in your network who know what you're looking for, the more deals you'll find.

#7: Find A Funding Solution In Advance - Winston Rowe & Associates

Commercial loans are a different animal than residential loans and in some ways better. The down payments needed are usually a higher percentage than loans on single-family houses, which means you’ll have to put more down (or get your partner to put more down). However, there is often no personal liability if the deal goes south, and they are more lenient about letting you borrow the down payment money from someone else. Nevertheless, before making offers, ask around and find out who the best lenders are in your area to use when buying commercial properties, as it may make the difference between qualifying for one or not.

#8: Winston Rowe & Associates Are Partners to Your Bridge to Wealth

Buying million-dollar properties is not something most people can qualify for on their own (in fact, getting a loan to buy a house is hard enough!) So make sure that you spend a lot of time finding private lenders or deal partners to help you out. A partner can provide the cash and/or credit needed to purchase a property, and you can compensate them by paying a fixed interest rate or a percentage of the cash flow or proceeds from the sale.

#9: Know Where to Get Tough Questions Answered

Lastly, it's imperative that you associate with experienced commerc...

Winston Rowe & Associates has an excellent knowledge based investor resource for commercial real estate valuation and market analysis located at: http://www.winstonrowe.com/Free_Real_Estate_Resources.html

Winston Rowe & Associates provides no upfront commercial real e...