Questions from a new investor..... :-/

[Carlos Quiros]

Hello All-

New to investing and had a few questions for those seasoned investors. My wife and I are looking at the mid-west to start investing (Ohio, Wisconsin, Indiana, Pennsylvania or Kentucky) My question are in the models I am running I am losing money on deals or barely breaking even. Should I expect to cash flow SOMETHING or just be happy with a breakeven/small lose and expect property appreciation to help later as a buy and hold.

For those of you that are already investing in these markets are there some your prefer over others?

What percentages are you seasoned investors assigning in your models for

• Insurance (I know that I can look this up but is there a baseline number to get an idea)
• Maintenance %age
• Repairs %age
• Cap ex %age
• Management Fees %age
• Who typically pays for (Gas, Electricity, Water, Sewage/garbage)

Should I avoid properties where I pay water as it would eat into my profits?

For those of you that are already investing in these markets are there some you prefer over others?

There’s so much to unfold and it’s definitely overwhelming but I thought I would ask those who have been in my shoes before. I know it’s a lot but it can be done since there are already so many successful investors here that show me all I need to do is keep going and ask questions.

Thank you in advance to anybody who takes time out of their already busy day to help a noobie

Carlos

[Trevor Richardson]

Quote from @Ryan Ness:

Quote from @Trevor Richardson:

Small multifamily owners are going to have to reduce prices quite a bit if they need to sell. 

 I'll keep waiting! I'm sure that there will be an opportunity, and I don't want to be the one to get burned because I sacrificed cashflow just to get a "deal" done! Some great insights  

Cash flow is one thing, it’s important to a segment of investors but not all. If you consider the market you are in, it’s housing stock, economics etc… and are able during this time to get something 30-40% below what was trading just 20 months ago, that’s a great investment. That may happen where you are (I’ve seen it in our market right now) where sellers have to sell for other reasons and are taking way below asking because every investor is on pause. Except a few.

Those few are looking down the road because when things stabilize that investment could pop right back up 30-40% and they will look like a savant. You sacrificed cash flow in ‘23-‘24 AND took some risk but came out a couple years later with an amazing deal. The comment you now hear in 2025 is, “man I should have bought in 2023!”