Christian Osgood and a speaker discuss why 10-to-30 unit apartment buildings are ideal for first-time multifamily investors. Mom-and-pop sellers, brokers, and lenders are more willing to work with inexperienced buyers at this scale. You need less capital than larger properties, so you don't have to raise millions to get started.
people that the sweet spot for any brand new person that wants to get into multifamily is a 10 to 30 unit apartment building.
Why is that the sweet spot?
More mom-and-pop sellers, mom-and-pop brokers, lenders will deal with you because you're new. Everybody will deal with you because you're new, because you're in that kind of more mom-and-pop space. Gotcha. And the capital is smaller. You're not going to raise, you know, $1 million, $2 million, right?
I absolutely agree. This is the sweet spot. I even expand it to 5 to 50 units. I'm buying a 200 unit right now. That's not where I started. If you're trying to get into the game, game, you got to do your first few deals. That is the size where brokers will play with you, banks will play with you, owners will play with you. There's a ton of creative finance opportunities. That is absolutely the place to start. In addition, the mistakes you make on a 200-unit are going to be much less costly on that 30 or 20-unit apartment building. They're going to be 1/10 of the actual cost as you're learning the game. Again, you can start way bigger than a duplex, but the sweet spot, 5 to 50.