3 myths about Flipping Apartment Complexes

By Michael Kimble

The average real estate investor assumes that investing in apartment complexes is expensive and difficult. The process of wholesaling multi-family units is very similar to that of single family homes and much easier to get involved with than most people are aware of. The current economy has created a perfect storm for investors who are educated.

Here are a few common misconceptions about multi-family units (apartment complexes)

Myth 1... The investor needs to have perfect credit to flip apartment complexes. False! The investor can have zero credit, and still make the deals happen. How can that be? Because Banks usually do what is called a non-recourse loan on multi-family units. Banks know that individuals don't have the funds and capital to put down even the first down payment on such large deals. The apartment complex is used as the collateral for such loans. The individual's credit record plays no part in the transaction. Only the numbers on the apartment complex matter.

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. - 23217

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.