Originally posted by @Joel Owens:
Don't know why in the heck you are wanting to buy a 14 unit property across the country. Makes zero sense at all,zero sense to own that number of units and class of property from afar.
I guess people will never stop trying to buy trash states away because it's cheap trash.
I don't like trash I like VALUE meaning for what you are buying you are getting a great deal.
With apartment buildings to own effectively from afar especially with an older building and C class at best type tenant you need about 80 to 100 doors or more. Those types of tenants and buildings take an full time onsite repair person and a full time PM to make the property go.
If someone can buy a 14 unit property then likely they might be an accredited investor. If they are they need to stay away from this stuff and look at possibly investing in higher quality sponsored projects that are larger.
Wow. Where do I begin. First of all, I'm upset because this wasn't what was advertised, I wasn't trying to buy a piece of trash. This was a nice looking 14 unit with 2bed/1bath units in a B to B- area. It needed new windows and maybe $2,500 per unit on average to make it the way I like to run my rentals - nice. Once I had my purchase plus initial investment, I would have been making 10% cash on cash............. AFTER 15% management fees (they take half or all of first months rent so it's not 10% folks). AFTER 10% maintenance, AFTER 10% cap x, AFTER 10% vacancies AFTER all the real expenses over inflated. I would be making 15 to 20% in you count amortization.
It makes zero sense at all, zero sense to own anything that you fix up a bit and run like a business to be less than that! And if you can show me a REIT that I can invest in at 7% that is older than 3 whooping years, then sign me up! I want to know a REIT has been around since 2003! I might as well buy stocks otherwise.
So size doesn't matter sir. If you can't make money on little stuff you shouldn't buy it, but people do... a lot of people do. I agree with what you are trying to say though, you can't own anything small and make money. I believe SFR's and most duplexes (unless you buy at wholesale and put lipstick on remodels) are hard to make pencil at the numbers I showed above. 14 units might be to small to you but they operate at the same rules as 140 units... based on rents, cap rates, etc.
@Joel Owens - What do you own? I'm not against learning but blanket statements about me trying to buy trash doesn't get me stoked. What do you own 100% in your name (or in llc)? If you partner into large large projects with other investors, do you have the controlling interest? Are you the guy who calls the shots? People like me have a hard time giving up control to other people... that is why we do it ourselves. Hell, I'd start a REIT and run the ship, but I'm asking you to sell me on being a drop in a big bucket of other investors.
I know this conversation is somewhat heated, but I'm very interested in learning. Thank you.
