My journey has been much like playing Robert Kiyosaki's popular game CASHFLOW®. I started by doing small deals, then gradually moved on to doing bigger deals. But, looking back, there is at least one thing I would have done differently. While I was building my portfolio, I would have partnered with a sponsor on a larger deal.
When you are under capitalized, you are not only taking greater risk, but you are also cutting off your property's maximum potential. So, know your CapEx budget, and don't ever go in under-capitalized.
I began my journey by doing dozens of single family deals before I graduated to doing larger multifamily deals. So, today is going to be a "Throwback Thursday", as I address one of the most common obstacles new investors run into—finding the right lender to partner with.
What if I told you it is possible to reduce one of your largest expenses by as much as 50%? It's completely true, and I'm going to "spill the beans" on how to do it.
I have always been a huge advocate of using professional property management. That doesn't mean you should take a complete hands-off approach though. The most successful multifamily real estate investors I know are all active owners, or they have delegated the responsibilities to an experienced asset manager.
Some people wonder why I have begun investing in DFW (Dallas/Fort Worth) when I already have such a broad portfolio in Denver. It is because I understand both markets, and I already know how to start an out-of-state investment portfolio. Let's look at the numbers...
I know many investors who are terrified by the thought of making out-of-state investments. A couple of the many questions I hear are “How do I get started in out-of-state real estate deals?" And, "I hear the returns are good, but what if something goes wrong?" If this sounds familiar, there are a few simple steps you can take to get started and increase your chances of success.
I once heard a successful real estate investor say, "The bigger the deal, the easier it is." It wasn't until I had begun to acquire a large portfolio of single-family homes this fully resonated with me.
"To be, or not to be, that is the question." Who would have thought Shakespeare was talking about property management when he wrote those famous words. The answer to that question is nobody. But, just as Prince Hamlet was bemoaning the pains and unfairness of life, every active real estate investor struggles with whether to deal with the pains of self-management, or to consider the professional alternative. Then, once you've decided, how do you find the right one?