How To Find Multifamily Deals

In the competitive world of real estate investing, two critical factors determine your success: deal analysis and deal flow. In this article, we’ll delve into the second half of this equation—deal flow, with insights and tips drawn from Bill Ham, Founder – Real Estate Raw. This article shares valuable strategies for finding and securing multifamily real estate deals.

Deal Flow Basics

Deal flow is the lifeblood of real estate investing. It involves the process of consistently sourcing and identifying potential real estate opportunities. Whether you’re a seasoned investor or just starting out, having a robust deal flow strategy is crucial to your success.

Two Key Methods for Finding Multifamily Deals

1. Direct to Owner (50 Units and Under):

• For smaller multifamily properties (50 units and under), it’s often more effective to go directly to the property owner.
• Build a list of property owners in your target market, specifying your criteria (e.g., location, property size, ownership duration).
• Consider using direct mail campaigns, such as postcards or cold calling, to reach out to property owners.
• Automate mailings but handle owner calls personally to establish rapport.

2. Realtors (50 Units and Above):

• For larger multifamily properties (50 units and above), working with commercial real estate agents or realtors is the norm.
• Research and identify reputable real estate firms specializing in multifamily or commercial properties in your target market.
• Create profiles on their websites to receive property listings directly to your inbox.
• Attend property tours with realtors to build relationships and gain insights into available deals.

Building Relationships with Realtors

To build effective relationships with realtors and improve your deal flow:

1. Start by creating a list of real estate companies specializing in multifamily properties in your target market.
2. Log in to their websites and set up profiles to receive property listings.
3. Browse currently listed properties and show genuine interest in the ones available.
4. Contact the realtor specifically about the property you’re interested in, focusing on price guidance.
5. Attend property tours to get a feel for the property and build rapport with the realtor.

Property Tour Best Practices

During property tours, follow these best practices:

1. Dress professionally (business casual) to make a good impression.
2. Avoid engaging property staff without the realtor’s presence.
3. Ask specific questions about the property’s condition, appliances, HVAC system, water heater, and breaker box.
4. Focus on the general condition and potential improvements needed for each unit.
5. Build rapport with the realtor and get to know them better during the tour.

Conclusion

Mastering the art of deal flow is essential for real estate investors looking to succeed in the multifamily sector. By adopting these strategies and tips, you can effectively source and secure multifamily deals, establish valuable relationships with realtors, and position yourself for success in the competitive world of real estate investing. Remember, a consistent and methodical approach to deal flow is the key to long-term success in the industry.