Too good to be true?

[Michelle S.]

We have our eyes on an out of state multifamily 80 units property right under $2 mil. The numbers look very good, meeting the 2% rule. The location is good, safe, but the schools are bad. The seller is putting in an call for offers, though the property seems to be on the market for quite a while(almost half an year judging from the snow covered ground pictures).

So what could be the pitfalls for such a seemingly good deal? The building is about 65 years old, and at least one building has water leaking issues.

We had the first exchange of emails with the listing agent. Should we still consider a buyers agent in such case? If we do get an agent, would that be considered as a negative by the seller because of added commission cost so as to lower our chance of further reducing prices? Me and my partners are new to multifamily REI.

[Mitch Stanley]

Suggestions - 

1. Education before Investing - Books, Seminars, Local REIA, plus your RE Mentor/Network

2. Start Small and Work up -  Fail Small at Begining  not Large.

3. If this property is for families - Poor Choice, but if it's for single adult, No Problem!

4. Representation- You need many people - CPA, Lawyer , Property Management 

  Advisor & an Experienced  Commercial Multifamily Broker/Agent.

5. Who will  be your Buyer in the Future  of this property ?

6. Look at ~ 100-400 properties before buying.

Best Wishes & Good Luck, Mitch S.