Best Strategies To Find Multifamily Deals
Commercial real estate investors have long chosen multifamily properties as an income source in their real estate portfolio. Whether you’re considering a duplex or a large apartment complex, the most appealing aspect of these multifamily properties is that they are widely considered a safer investment. Since you have multiple units that generate monthly rent payments, multifamily properties are often considered safe from economic downturns. Since each unit in the property is an income-generating property in its own right, multifamily properties provide a steady source of revenue. However, there are some tips that you should keep in mind when you’re searching for a multifamily property to invest in.
Contacting Commercial Brokers
Some real estate brokers specialize in commercial deals, and therefore have establishes connections with clients who are looking to sell multifamily properties. You can generally find commercial brokers in your area through a simple Google search. These commercial brokers can be contacted through a cold call where you simply tell them about what you’re looking for. Thanks to their access to the local MLS and their own personal network of commercial property owners, they can quickly point you in the direction of potential investment properties in the neighborhood where you want to invest. In most cases, these brokers are paid by the seller, meaning that you probably won’t have to pay for their services. For larger multifamily properties, you will want to find the brokerage houses in the market that are most active with those type of sales.
Use an MLS Yourself
There are some definite pros and cons associated with conducting your own MLS search. There are some websites such as LoopNet, ApartmentBuildings.com and CREXi that all have millions of monthly users, many of which are sellers who are looking to move their multifamily properties. The primary benefit associated with conducting your own MLS search is found in the fact that you will have access to a large number of options. However, doing your own MLS research also has some drawbacks. If a seller is utilizing a multiple listing service to sell their property, there’s a good chance that they are expecting to receive top dollar for the property. If the seller is willing to invest the time and resources associated with advertising and selling a property, they may be looking for a premium price for it. Also, you will have much more competition when bidding on properties on the MLS. When starting out, this is a good way to get into the game.
Contacting Building Directors on Your Own
The fastest route between two points is a straight line. That old saying certainly applies to real estate transactions and can help you when you’re scouring the market for a multifamily property. While this method takes some research, it can also be very beneficial, especially if you want to avoid a bidding war by purchasing a multifamily property that isn’t technically on the market. You can go to the county assessor’s website for the area that you’d like to invest and find lots of information about potential investment properties. Generally, you’ll want to avoid contacting property owners who purchased their multifamily property within the last 1-4 years, as they are less likely to sell at a reasonable price. Some of these owners may not be interested in selling, but in most cases, everything is for sale for the right price. Don’t be afraid to reach out and see if you can work out a deal. Building a relationship with a title company is also a good way to farm out these properties. They can provide you with a mailing list of properties that match your criteria.
Finding a good multifamily property to invest in can provide years of passive income, especially if you allow a property management company to handle all of your maintenance needs. Some of the most established real estate investors in the world have one or more multifamily properties in their portfolio, and there’s a reason for that. Having a revenue-generating multifamily property is a great addition to your portfolio and can help ensure that your children, grandchildren and other heirs enjoy the fruits of your labor for generations to come.