Adding Multi-Family Apartments to the portfolio

[Chad P.]

We currently have a SFR portfolio of 12 houses. I am looking into a multi-family deal in middle TN. Right now the complex is 24 doors and seems to be suffering from mismanagement and neglect as the owners are out of state. There is room for expansion and significant cost cutting based on the expenses the broker sent me. I am looking for ideas for financing. Most of my capital I have tied up buying and remodeling our SFRs. What options are out there for low or no money down deals? Syndication, syndicating, Fannie Mae, Freddie Mac? Asking price is $725,000. I think they would take less since its been on the market awhile, but I'd like to have money to do improvements and cost saving measures. Any recommended reading for Multi-family or syndicating? Thanks!

[Ivan Barratt]

@Chad P. I made several mistakes going from 2-4 family to mfam. One big one was under estimating expenses needed to run the assets successfully. Want to take one guess who conveniently left out some expenses?  Hint: it starts with "B" and rhymes with "joker."

If you haven't looked at 100 apartment deals and spoken to property management companies on running scattered site mfam (apartments that aren't big enough to support onsite staff) chances are you're in for some surprises.

Don't be arrogant and in a hurry like I was. Be better than me! :)