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Flipping Apartment Complexes... really that tough? 3 myths debunked.
Most real estate investors think that flipping apartment complexes is our of their price range and ability. The entire workflow of wholesaling multi-family units has a resemblance to flipping single family homes, and given the bad assumptions of the endeavor, its easier to take advantage of this niche market of real estate investing. Current market conditions have created circumstances that the educated real estate investor can cash in on.
I'm disabusing you of 3 incorrect assumptions below about flipping apartment complexes...
Myth 1... Bad credit means no deal! Not true! Banks actually care LESS about credit scores with apartment complexes. Banks know for a fact, private individuals rarely have the capital and cash needed to even get a downpayment on large multi-family complexes. What they truely look for is using the apartment complex itself as collateral... or also known as a non-recourse loan. The investor's credit score is NOT a factor.
Myth 2. If you don't have a huge stash of investment cash, your out of the game. Nope! When investing in apartment complexes, you use other people's money. You see, apartment complexes are profit creating assets, counting in the commercial asset investing area. Limited partnerships and syndicates pull together sums of capital to invest in them because they build profit right away, and happens every day. It's a common occurence. Current market circumstances have made apartment complexes great deals for these investors.
Myth 3... Apartment deals are just too difficult in comparison to flipping single-family homes. Untrue! Flipping apartment complexes is hassle-free by contrast. Most investors are intimidated by the larger numbers in these deals. That means less competition, and more buyers for your apartment deals. Property management companies are hungry for more business, to handle the day to day issues. Put those big numbers in these deals as fat zeroes on your assignment fee checks.
Take these myths and use them as motivation to start flipping apartment complexes. They are not insurmountable mountains of deals going dead. It's amazing that those non-existent obstacles have created a vacuum for real business to get done, for the professional and informed real estate investor.
About the Author Michael Kimble is a successful real estate investor, specializing in marketing. Wholesale Real Estate, is his site, where he gives away 7 free marketing systems for other investors.
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