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Real Estate Single Units, Multi units

Discussion in 'Real Estate Investing' started by Starsky, Jan 31, 2008.

  1. Starsky
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    Starsky New Contributor

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    All,

    I have come across a cpl of potential opportunities & wanted to hear your opinions..

    I came across an tired landlord who is wanting to liquidate 10-15 units of sfh's in decent/fair condition.

    Now the question is is would those who lean toward multi unit investing consider this worth their time to evaluate considering that all of the units are not under the "same roof"? What would the pros/cons be of having separately deeded multi units?

    Thanks
     
  2. JScott
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    JScott Legendary Contributor FASTLANE INSIDER Speedway Pass LEGENDARY CONTRIBUTOR

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    A blog post I wrote a couple months ago addresses this:

    http://www.threetypes.com/re/rental-types.shtml

    I think most multi-unit investors would not consider a bunch of SFHs to be part of their portfolio. The hallmark advantage to multi-unit investing is economies of scale, and for the most part you don't get that with SFHs (you do for some things like maintanance contracts, but that's about it).
     
  3. Bilgefisher
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    Bilgefisher Bronze Contributor Read Millionaire Fastlane

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    The one exception I read in Berges book, was 22 units within the same area. I believe they were duplexes. He was able to fix up the "community" and sell all 22(11 buildings) as a package deal.
     
  4. Starsky
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    Starsky New Contributor

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    These units are all within a 1/4 mile of each other, a cpl a are next door to one another forming basically a seperate wall "duplex". So my thinking is is if bought at the proper price, one could have significant equity that one could tap for bigger deals..
     
  5. andviv
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    andviv Gold Contributor Read Millionaire Fastlane FASTLANE INSIDER Speedway Pass Summit Attendee

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    What is your business and what is your investment?

    Based on what I am understanding from your post, your business would be either a) to flip these properties to generate cash for your investment, or b) to buy them with enough equity so they cashflow even after taking money from a HELOC.
    And then, I guess, your investment would be to take that money from those flips and use it to buy a multi unit property for cashflow.

    Is that your big-picture goal?
     
  6. Starsky
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    Starsky New Contributor

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    Im a buy and hold guy, so my goals (unless the market dictates different) would be to achieve my cashflow benchmark & have a heloc available for other opportunities that may arise.
     
  7. andviv
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    andviv Gold Contributor Read Millionaire Fastlane FASTLANE INSIDER Speedway Pass Summit Attendee

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    Then yes, your plan is correct, you need to make sure your purchase price is low enough so they cashflow and have room for a heloc. Please let us know how it goes in your negotiations and good luck.
     
  8. Starsky
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    Starsky New Contributor

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    No problem, Ill post as I progress.
     

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