Best questions to ask when buying a 4-plex?

Question

Theo Hicks · Answer

• Get your hands on the historical income and expense statements
• Perform a rental comp analysis to determine the market rents
• Determine the condition of the big-ticket items: HVAC, roofs, water heaters, plumbing (is it cast iron), siding, etc.
• Determine the level of deferred maintenance
• Will you self-manage?

Theo Hicks · Answer

@Jeff Ronningen Agreed. I found that out the hard way. But now that I've owned three 4-units for over a year, I have a better idea of the ongoing maintenance and repairs and turnover costs. That is why it is key to grasp the level of deferred maintenance and account for that in your down payment.

Henri Meli · Answer

@Kusha Karvandi .

Do you know your goals with the asset? Are you looking at it as a value-add play or a cashflow play ? How long are you planning to hold it?

What you ask and how the property will be managed really depends on what your end goal is. If you are planning to reposition and exit in 2,3 or 4 years, it is a different type of investment than buying it for your retirement ... etc.

Matthew Baltzell · Answer

@Kusha Karvandi I agree with @Nathan G. the more specific questions you have the better you will be.

With that said.

I'm providing you a link which will help guide you in asking more knowledgeable questions to brokers.

The  blog post is called Reduce Anxiety: Speak to Brokers Like Grant Cardone . It's a compilation of questions from him and some I've acquired as well. Feel free to use this as a reference to help guide you into developing your own speaking style.

Nathan Gesner · Answer

That's a very generic question with hundreds of answers. You should probably start with a book like this to learn more about multi-family investing. Once you have a basic understanding, then you can ask better questions and get answers.

Best questions to ask when buying a 4-plex?

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