Buying my first Apartment Complex

[Tony Nguyen]

Hey guys,

I'm a currently a rehabber that wants to buy and hold (and reposition) my first apartment complex. I've read about it ever since I was just in my teens and fell in love with the idea of economies of scale. I want to ask anyone that current owns or owned apartments HOW DID YOU BUY YOUR FIRST APARTMENT? I've crunched numbers for too long now and want to take the leap to Just Do It but want to hear what some of the more experienced ones have to say.

ANY advice would be appreciated. I look forward to hearing from you all!

[Bryan Hancock]

You can read and study forever, but nothing beats getting your hands dirty. Here are some pieces of advice that I wish I had when I bought my first apartment complex:

1. Don't rely too much of pro formas and fancy models. Nothing beats actual data. Repositioning is great, but don't fall in love with your ability to increase things too much. Be conservative!

2. Don't buy in the ghetto...it isn't worth it

3. The financing is KEY. Don't finance something you intend to hold long-term with money that balloons, adjusts, bubbles, etc. in a few years

4. Work with someone you KNOW can close the loan. There are a lot of pretenders in the CRE finance market that will promise you a lot, but can't deliver

5. Interview competent property managers in the area to make sure the owner is distressed and the property isn't distressed due to the market. You can't really do much with the market!