BEST MARKET FOR A $500K MULTI FAMILY

[Mansoor Fazel]

Hey everyone!

So I am in an exciting part of my real estate journey. I am about to sell my first property. I own over 10 doors, but have never sold one before. I have one that has appreciated substantially over the last 2 years and feel that its time to sell since I don't feel that market has much more room to grow and personally expect a crash ( in California ).  I am 1031 exchanging to a new property, but need to locate one. I have my "team" looking in the markets that I am already in, but I am sure there are other markets where there are great opportunities that I could be missing out on. I would love to hear from any of the experienced investors who are finding cash flowing properties in the multi family \ apartment arena. What markets are you buying in? What kind of returns do you expect on these deals ? Are you buying off market? Any advice on how to find the best deal is greatly appreciated.

Also, this is my first apartment purchase, so ANY advice is greatly appreaciated. Cant wait to hear from you guys! Thanks!

[Mansoor Fazel]

David Faulkner well there are so many things I can say to answer your questions. Let me do my best but I am on my phone on the way to the airport so bare with me.

1. My investment is into multi family property. In the past, when the housing market dips, the rental market will see an increase, so a crash would result in more people who need to rent, since they can't buy ( can't get loans or values for their home have gone down )

2. He crashes don't affect markets equally. If we see a crash in the tech industry, how bad do you think that will affect Kansas ? Also, because the prices are so low, if we see a 30% dip in prices across America. That means a $300,000 loss in the Bay Area where old mom and pop homes are $1,000,000 or more. But for a home that's only $50k or $100k that's only a $15/30k loss.

3. I own property now in Dallas and Kansas. I have taken time to study the area, the markets the job growth and demographics. I have flown out there and am comfortably familiar with the housing markets there. I wouldn't buy blind just cause everyone else is doing it. I justify my investments by my research. I don't have to live in a community to understand why the prices are what they are

4. Buying in lower markets is a form of loss mitigation. I reduce my risk by buying homes I can offer for rent for as low as $700 a month. When I am paying more than 4-5 times that for my own place. But in the end it's a numbers game. I still cash flow very well in these markets, and that's why I make the investments I make. "Live where you want, but where the numbers make sense"

Ultimately, even the crash I expect to happen will only be a blip in the grand scale and as a long term investor I am aware of that. But I want to be in a position to maximize my opportunity based on my research.

I hope this helps explain my ideology.