New to BP - Evaluating a 8 unit apartment Building

[Senia E Cuevas]

Hello BP, 

I joined this week and new to real estate investing - rental is the way I want to go. I found a 8 unit apartment building  $400k and have about 40k to use. Learned at the webinar this week that I need 20% down - and will have to take another 40K in equity from my primary residence which makes me nervous. The numbers look good - net 2,000 after applying the 50% rule and then paying mortgage. Should I start small -a duplex, or take the leap with this property. Thanks for your advice! 

[Nate Bell]

@Senia E Cuevas

Don’t be scared about starting with an 8 unit or making a stretch to get it, but you need to do better than just apply the 50% rule. You should be able to get a P&L statement from the previous owners, or recreate one. Call your insurance agent and get a quote. Call the City and find out what the taxes are. Talk to a local property manager about realistic rent and maintenance cost expectations. Get an inspection. I like multis this size, but take all the guess work out of it before you move forward.