Multi-Family Cash Flow possible in Los Angeles?

[Tim Farmer]

BP Community,

Has anyone has success in acquiring Multi-Family properties in the LA area that cash flow upon purchase?  How did you find these deals?  Am I going to have to suck it up and buy a property that operates at break even or a loss until I can raise rents or can I find cash flow gems?  Are there particular sub markets to focus on to give me a better chance without worrying about a buying in an unsafe area?

The market is so hot right now, most properties are being sold based on proforma or have unrealistic asking prices.  I have cash and the desire to purchase, but having trouble finding good deals.  Any advice or thoughts on this market would be appreciated!

[Gil Vaisman]

Hi Tim,

It's possible, but not easy. 

I've had success with fixers that are underperforming. Nothing sexy. Improve it, add a couple of rental units and couple months later you have cashflow. I focused on properties that had been sitting for a while and had bad agenting. I tried to avoid rent control areas and got lucky.  

There are ways to make it work, but you have to figure out what you're comfortable with have patience and be ready to act.