All Forum Posts by: Marc C.

@Robert Swingle

Hello, Robert! Albuquerque is an "interesting" multifamily market, to say the least. (You've probably noticed!) There are a TON of 4-plexes which would work for owner-occupied, and I'm glad to hear you're leaning that route. Are you a veteran yourself? If so, you might be able to buy it with VA loan with little or no down. Also, the New Mexico Mortgage Finance Authority will allow some buyers to get in with just $500 down. Not sure if they will do multifamily, but it's worth looking into.

Meanwhile, we have at LEAST 4 Meetup groups which deal with real estate, so I'm hoping to meet you in person sometime. I run the NM Real Estate Mastermind Group and the Apartment Investor Breakfast Club. Search www.meetup.com for details, and I usually post our meetings at www.biggerpockets.com/events. Other groups include NMREIA and the Albuquerque Congress on Real Estate. Both meet monthly with interesting speakers. 

Let me know if I can be of service. 

When I was an apartment broker, I always made sure and give prospects 3 years of operating history....unless there was something to hide! :)

That said, with the market having so many buyers and so few sellers, today, I often don't see anything other than a pro-forma. Depends on the broker. Residential agents selling a 2-20-family are usually too unfamiliar to even provide RENTS in their listings, let alone actuals for 3 years! And they always leave off property management. Commercial agents should have no problem giving you what they have. But if they have a ton of interest, and the other interested parties aren't asking for actuals, you might find yourself getting beat to making an offer.

Personally, I don't care if I have the financials prior to making an offer. Why? Because I will probably use my own numbers anyway. Expenses are usually lower for the seller than I expect, and vacancy is usually higher than I forecast. For example, property taxes will go up, I will pay a manager for EVERY property, insurance can be estimated with a quick call to one's broker, and utility bills can be had by calling the utility providers. I almost always figure expenses at 40-45% of ASKING rents (rent roll)...if I see numbers much lower than that, I'm suspect. 

How about contacting expired listings...buildings that didn't sell? Tell your broker you'll pay him/her 1.5% of any deal you find from the listings he/she provides...but you'll do all the work and they don't need to represent you in the deal (unless you want representation). 

Have you cultivated relationships with all of your local apartment brokers? Do they know your name when you call? What about property managers: Have you developed relationships with them, and asked them to provide you with leads as to any of their clients who might be looking to retire? 

Myself, direct mail continues to generate responses for 5-50-unit buildings. But no "deals" have turned up yet. Must be patient and repetitive. 

 Here's the 2016 version: http://units.naahq.org/august-2016/naa-operating-i...

And for 2015: http://m.naahq.org/sites/default/files/naa-documen...

These are, of course, averages for larger properties nationwide, so just use them as a guide. (But it's useful for showing sellers that they have too high expenses.) 

What about the 120+ real estate crowdfunding sites? Don't they do this exact thing: Aggregate investors into one group and provide that group to the sponsor? 

That's some incredible rent per sq. ft. you're getting. 

Good job, Steve! A lot of us are jealous that you've found a niche that will work for your market. 

I don't think you ever mentioned the square footage of the units?

For such a small loan size, I think it's a great product. 

Just a reminder: If you live in Santa Fe or Albuquerque and are interested in investing in multifamily real estate, our Apartment Investor Breakfast Club is just the type of event for you to learn and network with other investors, deal sponsors, brokers, lenders, and more. RSVP and pay the $10 charitable donation here:

https://www.meetup.com/Apartment-Investor-Breakfas...

"If you post it, they will come..."

In most areas of the country, there are way more buyers right now than there are properties to sell to them. Find a deal, get it under contract, then post the details (mostly the financials). If it's offered at over a realistic cap rate considering the property's condition, you will likely have no problem raising interest from investors.