I own nearly 5,000 apartments, THIS is why multi-family real estate is the best investment I’ve made.
In my humble opinion, real estate is the best way to grow your wealth. If you want to get super rich (think billionaire) get involved in real estate — but I’m not talking about just any kind of real estate.
For example, a home is not an investment, because it doesn’t pay you each month — you have to pay it.
It’s a liability to me, not an asset. Not only does a house leave you less mobile, it ties up your money so you can’t use it for real assets.
There are many indications that multi-family apartment investments will continue to be great looking into the 2020’s and beyond:
- 75 million Baby Boomers are retiring
- Many of today’s apartment complexes may be converted to retirement communities in the future
- Many millennials aren’t buying homes
- It’s getting more expensive to build new apartment units
Your first challenge is simply getting a down payment. Once you do, it’s easier to get a loan on a multi-family unit than any other piece of real estate. Multi-family is the easiest way to get rich once you’re in the game!
Let’s say you can find a 49-unit property priced at $35,000 per unit with an 8% cap (the return on investment based on the income a property is projected to create) for $1,750,000.
If you pay cash for this deal at $1,750,000, you would make $140,000 free cashflow per year after expenses. With $450,000 down and financing $1,300,000, the debt payment would be $78,000 per year. This would make you $62,000 cash flow per year. This cannot be done with a home, period.
For the vast majority of people, college never leads to riches, nor does a home. If your goal is to build up $300,000 of equity over 30 years, then buying a home is a way to park your money the same way you would in a savings account or under a mattress. If you want to leverage your money and grow wealth, buying a home is not the way to go.
If you go into multi-family the right way, over the next decade it could be the best investment of your lifetime — and I put my money where my mouth is. I currently own almost 5,000 apartments and will soon have over 10,000. They are not building enough multi-family apartment buildings to keep up with demand.
If you want to get involved in multi-family real estate, start with a minimum of sixteen units, avoid single family residences and condos, and only buy multi-units at one address.
If you struggle with producing enough income to save enough for a significant down payment, you can partner with me in smaller amounts.
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