HMM, MORE DOORS UNDER ONE ROOF. ON A PER UNIT BASIS, THEY’RE ACTUALLY LESS EXPENSIVE.
What does that mean? It means you need to keep your eye on the prize. Even though you’re not managing your property yourself (thank goodness), you absolutely must pay attention to what is happening with your assets. In a previous AAOA article, I talked about managing your property manager. It’s not like it’s a LOT of work, but it still does require you to stay engaged by knowing what is happening, reviewing monthly reports, asking questions, etc. If you ever want to scale significantly from single family to multifamily, you must make the transition from self- management to third party management. Just like you probably leveraged the bank’s money to buy your property, you must start to leverage your time in order to create space to (1) learn and (2) buy more assets. There is a learning curve in transitioning from single family to multifamily. How much of a learning curve? It depends on what type of multifamily real estate you want to transition into. There are two categories of multifamily. One is small multifamily (2-4 units) and the other is apartments (5+ units). It also depends on where you live and whether it’s a cash-flow market. If you’re like many investors, where you live has prices that make it impossible to buy for cash flow. This means your learning curve will include learning how to be a project manager instead of a do- er. You’ll have to learn to invest remotely, which is a lot easier than it sounds, once you wrap your mind around what is involved. Okay, putting that one piece aside, let’s begin by discussing the difference between small multifamily and apartments. Both are multifamily, but they are very different.
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