Are we smart, or taking the easy way out? We need your opinion.

[Chad Miles]

Hello BiggerPockets!

Let's call this a... re-introduction. My name is Chad Miles I have been a member on BiggerPockets for a year or two now and have participated in some discussions and learned a ton. Now, I want to reintroduce myself and also gather feedback from a more experienced community on the course of action that my brother and I are currently on.

To back up, my brother, Evan Miles, and I are 23 and 21 respectively and currently each own duplexes in the Metro Detroit area of Michigan that we "house hack" by living in one side and renting the other to pay our mortgages. We love multifamily investing because of the reduced transaction costs and benefits to having more units in one location. We are ultimately interested in going into multi family apartment buildings using a syndication model and have spent the last few months making connections in our area and assembling a team of contacts that we can utilize in all steps of our business plan as we purchase value add apartments.

As we have gone down this road, we have realized a couple things including: financing is a much different beast for commercial loans rather than for standard residential mortgages. Finding investors that trust and believe in you can be difficult with a lack of experience or track record. Utilizing a syndication model has many nuances as far as who can invest and how deals and LLC's are structured which plays an important role. The more we research and listen to people with experience, we hear that there are always deals to be found (even in this stage of the cycle) and the most important thing is that we "buy the property right". The problem lies in that statement; as first time investors, we lack the knowledge base to know that we are "buying properties right" and to make sure that our numbers are sound.

In essence, we have learned that we still have a lot to learn... So we are thinking that we may pivot our course of action over the next couple of years in order to learn more about the industry and gain some first hand experience that will be crucial as go into business ourselves. Here are the three main things that we see ourselves doing over the next couple of years in order to position ourselves best to successfully plunge into our business when the times comes:

1. I currently work in IT at a large company and while I enjoy it, my passion lies in real estate and this job does not help me to gain experience that I can then take into our business. I plan to leave my current job and seek employment in the real estate industry. My question to you is this: What job experience do you think would be most beneficial for me? taking into account what we ultimately want to do. I have heard people coming from brokerage, property management, acquisitions, etc. to going into business for themselves. Maybe a combination of a few of these! What background did you have before starting your own investing business and how did it help you?

2. We are in real estate investing to put our money to work and earn residual cash flow. If we do not feel ready or totally comfortable with the multi family apartment space, why not focus on something smaller that we know well? Duplexes. We want to spend the next couple years acquiring as many du/tri/quadplexes as we can so that we are still putting our money and building wealth as we also build our knowledge base. This also can give us more of a track record when the time comes to get financing and gather investors for bigger deals. I have feeling that as we do this, we will become more connected in the real estate community and maybe start to gain connections into the larger multi family space. 

3. Lastly, we still want to get into apartment buildings because of the scalability of that business model. Our goal is to spend the next couple of years seeking opportunities to at least be a part of large multifamily deals in some way. Whether it's bringing money to other larger more experienced investors in exchange for the experience of being part of a deal, volunteering our time and skill sets in order to help make investors lives easier in exchange for some of their time or knowledge, or maybe something else! As an experienced investor: what would you want from us in order for you to take the time to walk us through deals and help us to gain the knowledge and experience that we need? We are young and have time and drive on our side, but of what help can we be to you? 

If we combine these three courses of action, we hope that when the market takes a foreseeable dip in the next few years, we are then ready to take advantage and pursue our own deals with knowledge and experience to back us.

What do you think of this plan? Are we taking the "easy way out" by not continuing to push through and pursue larger multifamily deals at this time? Do you have any answers to our questions or advice to us based on your experience when you were at our stage in your career?

Thanks for your input, we value it more than anything and appreciate everyone on this great community!