How Do I Get Started In Apartment Investing And Find A Property?
Getting Starting in apartment investing is the simultaneously thrilling, and overwhelming. Thrilling because it is pretty clear to see, once you get through the learning curve and past deal number one, your money worries are over. Overwhelming because, let’s face it, you’ve probably bought a house before, but not an apartment building. There are more moving parts in an apartment investment and the numbers are bigger.
It might be a lot to get your head around at first, but in the end you are so far better off buying apartment buildings than houses; both with monthly cashflow, and appreciation.
How do you get started in apartment investing though, how do you find a property?
Getting started really means getting educated. Learning the basics of what makes a “profitable” deal would be step one. There are many good courses. I am partial to mine though, the SMART Guide To Apartment Investing; a) because it is free, and b) because it is so darn big and comprehensive. I challenge you to find another free course that delivers so much educational value about apartment investing. Anyway, start with getting a good course and getting educated about the basics of apartment investing.
Once you have a basic grounding in the basics of apartment investing, find an active apartment investor and offer to be a deal finder for him or her. You may be entertaining romantic notions of hurling yourself into the commercial real estate scrum and emerging scarred but victorious with a hot deal and millions in equity, but if you are starting at the very beginning, that’s dreamland. Seminar stuff. Just about any story you hear about starting broke, bankrupt and faking it until you make it and so on, is almost always the end result of a lot of very relevant experience that came before and laid the groundwork for a redeeming success.
The bottom line is, if you don’t know how to do something yet, you need to learn, and acquire the skills, and the fastest way to travel the learning curve is at the elbow of a mentor. The best place to find a mentor is at your local Apartment Owners Association, or your local REIA. You may not find the right person right away, but if you keep looking, you will.
With the right mentor you can start at the beginning and focus solely on finding deals. Your mentor will tell you what to look for, and you can apply yourself solely on going out and finding those deals. This helps you in two ways, 1) you learn what the criteria are for profitable deals, and 2) you learn to focus and say “no” to deals that don’t fit your criteria. As you bring deals back to your mentor, he/she will tell you which deals are good, and why, and which deals don’t work, and why. In short order you develop a very keen eye for profitable deals, and then you start making some money, earning while you learn.
What are good places to find deals?
Brokers: Of course, but connect with brokers who list the type of properties you are looking for, and maintain a professional relationship with them, always adding value, and you start getting deals before they hit the MLS.
Walking into a leasing office and asking to speak to the owner. This requires a bit of confidence on your part, but if you do it, you get something that none of your competitors do; the complete focus of a motivated apartment owner. If the owner is motivated, and you have your game together and are ready to offer solutions, you can put deals together on the spot. And best of, it is free.
Direct mail: sending postcards or letters to apartment owners is a reliable way to generate dealflow in any market. You can get a list of all apartment owners in any county by calling the County Assessor. Sending a mailing out to a portion or the whole list will generate a steady flow of apartment owners wanting to sell.
Networking: This is the most effective source of deals. Making contact with people in your local real estate community and then tapping into their networks as well, is extremely powerful.
To fast track your apartment investing, subscribe to the SMART Guide To Apartment Investing (remember it’s free), then attend your local Apartment Owners Association, then seek out a mentor and start finding deals for him/her. You will acquire your apartment investing skills very fast, and you will be on your way to building your fortune with a sizable apartment portfolio.