Fellow BP-ers,
I have been in the short term vacation rental and SF long term rental business for 10 years now, and am entering the multifamily side of REI in an effort to scale and expand my business.
I have read a multitude of books, listened to numerous podcasts and reviewed as many resources as I could find on Multi-family/apartment investing to further educate myself. Along the way, I found that there was a veritable horde of people willing to train individuals on the subject, with many of these having very large price tags.
What was surprising to me was that many of these services did not seem to have a very long list of closings/deals, visible resources and/or proof of concept that I could see. Has anyone else experienced this? How does one separate the wheat from the chaff?
@David Cozzi all the education you need is right here on BP and free online. Personally I wouldn't pay more than the price of a BP pro subscription. Dealcheck app is useful for deal analysis and can even learn a lot of terms/definitions/calculations. Rentcast.io is good. Rentometer. Google everything then start going down all the rabbit holes you come across. Find a market and learn the good areas, rental rates, comps, etc. Find an investor friendly realtor, lender, PM, and fellow investors. Search BP for answers and ask your own questions. It'll take a few months, but doing your own leg work is worth a lot more in my opinion.
I think it all comes to training vs education. Say you want to hike from point A to Point B through the woods on some trails. Training is like paying someone to teach you: walk two miles, left, walk 1.4 miles, right, 5 miles, middle fork ect. Education is paying someone to teach you how to read a map. Sure learning how to read a map will take longer, but you can then get yourself to any destination with little help.
Unpopular opinion here, but at the end of the day, buying an apartment building isn't that hard. Brokers want to sell them, banks want to make loans, sellers want to get the highest price they can. What is hard is buying an asset that has a high probability of getting the return that you want and a low probability of losing you money.
Everything else is just window dressing.
I'll add to what @Bill F. said.
"What is hard is buying an asset that has a high probability . . .
It is also hard to properly manage a property until you get your systems and the right manager in place. Then it can be relatively easy.
@David C. I have gotten something out of every program. But I got to the point long ago That if I got just one good solid tip it was worth it for me. Some of the old time gurus offered great value. You could buy their workbook, audio and or video course for $500-$1500.
Today if you buy a course at that price it is going to give little info and will only be an up-sell to a more expensive course. Perhaps that is the tip off. If you don't learn anything of value from the free pitch or least expensive class then don't consider paying for their more expensive training.
i also used to believe the value of a course was inversely related to the price. A $2500 course often gives you more info that a $20K mentoring program. I have met multiple people who have spent over $50k in training and have not done a deal.
Another tip off is; does the actual figurehead deliver the training. Robert Kyosaki of Rich Dad, Poor Dad fame sold real estate courses. But He didn't teach them, paid trainers (who might not have any real estate experience) taught them. The same is true with Donald Trump and "Trump University, and many others.
Next avoid anyone that has a UT address. That seems to be where the company or companies are located that do training subcontracting under another investors name.
Now specifically regarding multi family I would buy @Brian Burke's book published by BP. It is not about how to buy multi family exactly but how to invest in a syndications created by others. Worth the read whether you want to invest in another's deal or if you want to open your deals to others.
I never took Dave lindahl's in person training but I did buy his "home study' course and his book Multi family Millions. I thought he was good at presenting the good with the bad. Many gurus skip the bad but that is what you need to be prepared for. I believe Dave now has high end coaching so expect an upsell.
There is a home study course (an expensive book in a binder LOL) by Ray Alcorn called the deal makers guide. It is excellent.
Regarding evaluating properties, I think there is no better source than the CCIM training. This is high end commercial training. This is not your typical Guru training, this is serious training for commercial agents. You will really learn to evaluate the numbers and markets with their training. It is pretty intense.
You may be the type that can benefit from a coach. This may mean a high end program. There is nothing wrong with spending high dollars for an expensive coaching program if it is good and you will actually use it. The tough part is evaluating who is genuine and who are the jokers. Other than the above i can't help you there.
Outstanding insight and advice! I greatly appreciate the dive into alternatives to the typical Guru models that I tend to see everywhere now. This is not to say that there are not great mentors/coaches, but it is near impossible to tell one from another when everyone seems to make the same claims.
Though I absolutely believe that you get what you put into a program - However, when I researched certain programs, I found that the measure of success was squarely placed on the student laying out the big bucks. So in theory, a motivated and dedicated student could enroll in a program that has pitiful resources, unreliable teaching and poor practices, but if the student was unsuccessful, it was singularly their fault. Hmmm....that's convenient...
On a side note, I am a big fan of @Brian Burke 's book. That book and Fairless' syndication book are two of my all time favorites.
Thanks for all the advice - I really appreciate it.
Multifamily investing is third-grade math. It's just been, in my experience, the most pain in the arse form of investing that's out there. That's why everybody CAN write a book on it and the reason they write the book is because it will sell because it's an investment people think they CAN do and they're right. Anyone can do multifamily investing. It's technically not that hard. Attorney Robert Shemin wrote a pretty good book on it years ago that pretty much explains all you need to know, except for the pain in the arse part. No one wants to write the real book about this "Multifamily Investing is a Pain in the Arse." The reason you do it is it's an equity gateway into buying easier investments and the tax write-offs along the way.
@Timothy W., I agree multifamily can be a pain in the butt. But I am curious why you define multifamily investing as third grade math? How is it any harder that office, industrial, retail, hotels, or self storage?
Overall, investing is "very easy" on the surface. Buy something that either has potential to grow and/or create income. I think the big difference with real estate, and particularly multifamily, is most "investors" are buying a profession. Direct real estate ownership is not INVESTING. If I buy a single family home, 4 flex, retail center, or office building as a sole owner, I have to manage that property, either directly or as an asset manager. I am working, maybe not full time or very hard, but I need to make sure mortgages get paid, tax and insurance bill, make sure the PM is doing their job, quality tenants are being put in the property, refi's, etc.
Actually it is investing. Investing means the commitment of current resources for a greater future return. I didn't call it passive. As to why I call it third grade math, that's when I learned percentages.
To some degree yes, there were A LOT of people that got into MF syndications in the last few years. It seemed like everybody and their Grandmother was doing it. So many people making offers on the same property just to get a "deal" ended up not being a good deal for many. And made it very hard for the legitimate operators to provide great returns back to their investors. Many of those "deals" are the ones you are hearing about now having capital calls and foreclosures.
That is partly the reason why I made a shift to a less crowded niche with potentially higher returns. RV Campgrounds. I've been doing it for about a year and a half now and I like it a lot more. Much better cash flows and no evictions to worry about. Our investors can see a big difference when comparing different asset classes.
But to each his own. Everyone has different appetites for risk profiles and expected returns. I just happen to prefer double digit cash on cash.
Isn't that the truth. No one talks about their BRRROMG. That investing in RV campgrounds is very clever. I've been interested in doing something similar here. Do you mind if I message you privately on that?
@Timothy W. Not a problem at all. Happy to talk