Investing in Multifamily in Today's Market

[Martin Jones]

I'm a young individual who is deeply interested in investing in long term multifamily. I don't exactly understand how anyone invests in today's market (especially as a beginner). If anyone has any input or advice on whether to invest now versus waiting on the market to hopefully cool off, I would greatly appreciate it.

thanks! 

Martin 

[Bryce Jamison]

Time in the market beats timing the market. If you're hoping to wait until interest rates come down, not only do we have no clue if or when that will happen, but when it does you may see prices go up as buyers are able to get larger loans. Although we may see more inventory hit the market as people can escape "rate lock".

I invest in today's market by searching hundreds of properties on the MLS, then going to see the top 10-20, then making an offer on the best at a price where I can cashflow after all expenses and putting 25% down. While my cash flow isn't amazing today, I'm investing in areas I think will experience appreciation and rent growth, and if rates do ever come down I'll refinance and be doing great. I admit it's not sexy and it's slow, but it works.

If I had to do it all over again, I'd buy a personal home with 3-5% down then repeat every 12-18 months. You can house hack while doing this too to really speed up how fast you can scale. Multifamily can be challenging to find because basically all investors want to start by buying a 4 plex and living in one unit. If you can't find one you can house hack, found houses with garages, attics, or basements you can rent out, or find property where you can add ADUs or put trailers out for people to rent.