Here is a scenario that I know exists in the back of every real estate investor’s head: It’s Friday night and you have just settled in with a beer in front of the TV looking to unwind a little from a hectic week. Then the phone goes off. An irate tenant is yelling down the line at you about some plumbing that needs urgent repair and simply cannot wait.
No sooner have you managed to calm down the tenant and your blood pressure than the phone goes off again and this time it is one of the caretakers calling to tell you that a smoke alarm has gone off in one of the properties and there appears to be no tenant inside at the moment. Needless to say this is all a total nightmare.
It is also totally untrue. One of those fallacies we seem to be happy to live with. I know this because I personally owe more than 4,000 apartments in more than six states and had this been true I would not have a single quiet Friday night, let alone any other night in my life.
As it is I go through life without seeing a single tenant and without having to deal with a single one of their problems while at the same time the sheer number of apartments I have provides a constant stream of income and remain profitable irrespective of how many tenants have moved out, how many flats need renovating, how many are being upgraded or how many are being re-advertised for tenancy.
Besides ensuring that the numbers cushion any loss and spread the potential risks they also allow me to achieve significant economies of scale and outsource everything to a competitive bidder so that all my properties are ran for me by a professional company, all the repairs and upkeep is done more economically than would have otherwise been possible and I am let to do what I do best: close deals, refine my real estate investing
strategy and focus on making money and enjoying life.
I know this sounds too good to be true. It’s not. It certainly is great but it also requires hard work, attention to detail and a head that’s clearly focused on a goal of total financial independence. Closing multi-family dwelling deals takes almost the same amount of effort to close as a single-family dwelling and the potential returns are multiplied through the number of tenants involved.
It all means that when it comes to getting your act together in real estate investing it pays to think big and have your eyes clearly focused on the big picture. That way you will get to your dream of total financial independence faster.
Multi-family dwellings as a long-term real estate investment strategy
Labels: Property