New investors...Should you start out small vs larger when investing in Multi-Family?

[Darnell Lockett]

I've seen this question often here on BP. When you're first starting out as an investor and you want it to be in MF properties, is it better to start with a 2-4 unit or go with something larger such as a 10-12 unit? Imo...a lack of experience is going to come into play. If you're new to investing and want to start in MF, a 2-4 unit is where you're likely to find more success with financing. I can't speak for other lenders, but I don't know any willing to lend on a 10-12 unit property for a new or inexperienced investor (we're not...unless you have a strong sponsor on the deal with you).  Get your first 2-4 unit in your portfolio and manage it efficiently. Add another four unit property and do the same. Now you have a more favorable chance of getting financing for that 5-12 unit property.