The ABCs of Apartment Investing to Maximize Profits

1
The ABCs of Apartment Investing to Maximize
Profits
2

• The ABCs of getting the most out of investing
  in multi-family properties the way my students
  did means you should focus on three objectives
• A. Get the highest appreciation in the shortest
  amount of time
• B. Put as little money down on the property as
  you can and 
• C. Get that money back as soon as you can.

3
Conventional Wisdom vs. Conventional Opinion

• If we go back to the specifics of apartment
  investing, you must always remember one crucial
  point when buying with no money down the
  property must cash flow properly. By properly I
  mean the debt coverage ratio must be 1.20 or
  higher with 100 financing.
• Heres another example of conventional opinion
  being wrong its actually easier to purchase
  a multi-family property with no money down than
  it is to buy single-family properties. When
  youre dealing with the owner of an investment
  property, youre dealing with an investor. Those
  people focus on the numbers, and if the numbers
  work, the deal is likely to get done.

4
Stitching Together the Financing

• Even though multi-family properties are
  investments, its sometimes challenging to get
  conventional bank financing for them. It really
  depends on the bank, the specific property, and
  the current lending environment. Fortunately,
  many private individuals are happy to lend you
  money that they may have sitting in a savings
  account or an IRA, earning basically nothing,
  provided that you are willing to give them an
  8-10 return. Of course you factor the higher
  interest rate into the deal when calculating the
  numbers and if it cash flows properly, its a
  buy. If it doesnt, you should walk away.      

5
Return on Education

• The transaction the Frews did was a good example
  of the ABCs of getting the most out of a deal.
  Time will tell how the ultimate appreciation
  works out, but when you have no money of your own
  in the deal, and youre getting cash flow each
  month, then waiting for appreciation doesnt feel
  so bad.

6
Contact Us

• RE Mentor, Inc.100 Weymouth StreetRockland, MA
  02370.
• Call 1-800-649-0133
• Email support_at_rementor.com