Am I ready for Multi-fam and Apartment Investing

[Helen Chau]

Greeting everyone!

I would like to leverage this group's expertise to help assess my readiness for multi-fam and apartment investing.

I have been a SFR landlord for 4 years. The properties have been providing decent cash flow and appreciation over the last 4 years. I have taken most of my money out (down payment) through refi and the properties still cash flow positively. I am thinking of selling the properties, taking the cash out and putting it into a bigger project.

I am doing my research now. So far I know I have to have 20% down, 10% in reserve, plus inspection / appraisal / closing cost etc. I should do a 1031 exchange when selling my SFRs and put that towards the multi-fam property. I have a CPA and attorney in my power team to help me when I am ready for a deal.

My questions are:

1. what else do I need to be sure that "I am ready"?

2. what do I need to be ready for when I am going to talk to a commercial lender, knowing that they will look at deals very differently than residential? e.g. will my 4 years of landlord experience and full time RE investor status be good enough? This will be an initial conversation because most likely I won't present a deal (I don't have yet). Rather, I will try to find out what type of property I can do given the amount of down and reserve I have, rate, cost and qualification of borrow(s).

3. any other resources I can tap into to help me get ready? I have been reading posts on this forum and found them helpful.

4. what size of multi-fam project should I look into as my first deal? And what type of lender should I talk to?

Appreciate any thoughts and tips on this!

Cheers,

Helen