NEWBIE @ REI.. Pro @ Construction.. Getting Started in Multi-Fam?

[Luis Orts]

BIGGERPOCKETS!!!! WHAT'S UP!!

I've been on the site for a few years (since I was 20, now I'm 25.) but really feel overwhelmed with all the information flowing through the internet on Real Estate Investing, specifically with Multi-Family Investing.

Right now, I'm currently the proud owner of Revitalize, a Commercial General Construction and Facility Maintenance company in Houston, Texas 

I've been doing this for 4 years and feel that my team of 25 is moving up, but a lot of my resources are tied up in this company trying to grow..

Here's the thing.... I want to create FINANCIAL FREEDOM. But I don't have a whole ton of capital available for investing (YET).

I understand, very well, the following things:

1) Team Building

2) Marketing

3) Sales

4) Processes

But I'm having a hard time grasping Real Estate in general... I'd love to start syndicating Apartments that have deferred maintenance or need a management revamp.

I kind of understand the process....

1) Find a deal

2) Analyze the numbers

3) Make an offer

4 or 5) Walk Property and create assessment (ROOM BY ROOM) / Raise Capital?

6) Close

7) Revamp

What should be the next step for me?

I do have a budget for Marketing and would be willing to hire a VA, but I feel like I should get my feet wet first...

Any suggestions would be AMAZING!!

- Luis "MR. REVITALIZE"

[Josh Dillingham]

it sounds like you are in a great position for the BRRRR strategy. Buy, Rehab, Rent, Refinance, Repeat. being in the construction business you'll be able to identify properties where you can force appreciation buy fixing them up, once you have completed the rehab and are renting the units you can do a cash-out refi for 75% of the appraised value of the new and improved property, which allows you to pull out your initial investment to use as a down payment for the next property. example: you purchase a 4 unit property for $100,000 with a 25% down payment. it requires $15,000 of repairs in materials, you can do the labor yourself. closing costs are $3,000. total cash needed up front: $43,000. after the renovation it appraises for $175,000. you do a cash out refi with 75% loan to value ratio for a loan amount of $131,250. closing costs for the new loan are $3,000 you pay off the old mortgage of $75,000 and you are left with $53,250 in your pocket to use on another deal, which is your initial up front investment of $43,000 plus an additional $10,250 that you get from the appreciation you forced with your renovation, so in total you ended up spending none of your own money, made $10k and now have a 4 unit property that probably cash flows around $1,000 a month. and you have $53,250 to do it all over again.