Acquiring 50 units or more; what makes this difficult?

[Geoffrey Murphy]

BP,

I don't believe this difficult, I believe this is very much doable. However, what makes achieving this goal so difficult for most investors? Seeing that "financial freedom" is the HUGE topic now a days. Why is it that some investors achieve this/ANY GOAL towards financial freedom. (Just using this as a number) 50 units=5,000k a month

What makes this difficult?

-not enough capital?
-inexperience?
-Focus?
-unrealistic planning?

Interested to hear your thoughts BP, I mean REAL ESTATE wise, which I'm sure other people can agree, there are a lot of investors, especially here on BP that makes 5,000k a month look likes crumbs!!

[Brian Burke]

The challenges vary depending on the individual and location. For example, financing is a challenge because lenders in this space are sensitive to buyer experience, liquidity, net worth, track record in the area where the property is located, and management plan, among other things.

Capital is a challenge, because creative financing strategies, while not impossible, are less common. Even if creative financing can be done, capital is still needed for reserves, capital improvements, closing costs, third party due diligence, lender commitment fees, full-year insurance premium for year 1, utility deposits, etc.

Acquisition is a challenge because you have to convince brokers and sellers that you can perform. Brokers get a lot of calls from buyers that aren't "real", and they don't like to waste time. If they know you, no problem, but if they don't know you, expect to be questioned about your background. In many cases, brokers require that you submit a resume along with transaction references with your offer. I always wonder if they ever call those references...

Making mistakes is a challenge, because oversights are amplified on deals of this size. Inexperienced buyers can easily dismiss what they think is a minor problem, to find out that oversight wipes them out after its too late to turn back. For example, I once toured a 100 and something unit property and noticed some areas where ceiling Sheetrock had been patched. I asked about it, and was told it was a water leak repair. After seeing similar patches about a dozen more times, I cornered the maintenance man and asked him what the biggest maintenance challenge was. You guessed it...water leaks. They had no water softener, and very hard water had eroded the thin copper pipes from the inside out causing spontaneous leaks all over the place. This whole complex needed to be re-plumbed. Without seeing warning signs and digging deep, missing this minor detail would destroy a first time investor.

Ok, now that all of that has been said, it is absolutely achievable. If the above challenges don't apply to you, awesome. If they do apply, getting capital, experience, connections, etc by doing smaller deals will get you where you need to be to pull this off.

Good luck!