All Forum Posts by: Kyle Vogeler

Very happy to hear you backed out of the deal. I was worried that this was going to be a horror story. Well done

Chaim, 

If you are looking to invest in areas outside of your home town, I would start by making a list of areas based off of a few factors:

- growth trends over the past 3-5 years

- median income

- job growth (or major employers in area)

- crime rating

- average rent/average vacancy

You can add other metrics as well, but this will serve as a good start. Once you get data for all of these metrics, you can rate areas and give them a score and determine which areas fit your investment goals.

Nice to meet you! Feel free to connect if you want to talk real estate

You are asking a question that can and will be answered differently by everyone you ask.

Is all your cash stuck in one property? Does selling allow you to purchase 5 new properties with value add potential? Can you avoid taxes if you sell? Can you increase equity of monthly cash flow by selling? 

There are many questions to consider before answering the question you asked and they are specific to each persons resources and preferences. 

Generally, buy and hold is a good strategy. But is it always the best option? No.

Before purchasing, you can and should look at the current leases that the tenants are under. If the leases are almost at the end of their term then you would have the flexibility to raise their rents or find new tenants.

It's never easy or fun to raise rents, but when they are this far below market you have to take advantage of the extra cash flow you can obtain. 

I would say that it mostly depends on the location. A mixed used building in downtown or center city could be very appealing. Getting a nice restaurant, coffee shop, laundromat, or boutique to move in beneath your apartments would add attractions for your tenants. 

Where as a mixed-use in a rural area that has apartments next to or on top of a garage is significantly less appealing. The garage adds little value to your tenants and actually probably lowers the amount of rent you can get from the apartments.

Each deal is unique and there may be great garage/apartment deals that you stumble upon, but for the most part I would take what I said above into consideration before purchasing this type of asset. 

It's easy to find reasons not to invest...they have always been available, especially when you come off a period where the interest rates were down below 4%. That was an historical anomaly though, rates have more consistently been where they are now and there have been many successful real estate moguls over the years. 

That being said, yes, multi-family is still a good strategy for long-term wealth building. In general, people will always need a place to call home. As for class of building, that is up to investor preference. Class A is usually the safest, but offers the lowest returns. Class B&C offer higher returns with higher risk, and the lower down you get the higher that risk rises, especially when the market takes a turn for the worst.

Lastly, cash flows should remain mostly steady despite operational costs. Generally, as costs go up, so do rents, and if certain operational costs spike, then you go to market and try to find better rates. It's not always easy, but vetting a good property management firm should help reduce your personal burden. 

 This is a great response, thank you. We are definitely prioritizing portfolio growth at the moment, with the delayed expectation of bank account growth. What I mean by that is: we are not simply buying just to buy, as many individuals did in 2021, we are buying properties that make sense to improve with the anticipation that the improvements lead to equity or cash flow improvement at a later date.

And as always, we are constantly looking for lessons and experience. Every time we handle a scenario and it didn't go 100% perfectly, we complete a debrief, creating and correcting processes.

 Ben, I should have been more specific. We have cash to put into finding our next deal - we can cover networking expenses, legal fees, and other incidentals and could probably cover a decent portion of the down payment, but we would definitely come up short and would require us to put in money outside of our business accounts, which is what we are trying to avoid. 

BP Community, 

My partners and I have been in real estate for 4 years now - we've worked on single-family, small and mid-sized multi-family deals, and done full renovation projects. Now that we've gotten the experience, we feel comfortable with aggressively growing our portfolio. 

My question to you all is: how have you managed to attain aggressive growth goals without using out-of-pocket money? Did you partner with people outside of real estate looking to diversify their portfolios? Did you partner with more experienced real-estate investors and work with them as a sort of mentor?

We have projects identified and the analytical work done, we just need to figure out the best way to gain interest in our projects. 

Thank you!