Let’s talk about scaling in real estate, whether that means moving from no properties to single family or single family to commercial. In general, we’re just going to talk about taking your business to the next level.
To explain how scaling is possible and how to have the courage to take the plunge, I’m going to talk a little about how I did it personally.
How and why?
1. When I sold them, they all had appreciated quite a bit.
2. The amortization (pay down of the loan) was decent—a good chunk of change.
3. I started with someone who works on the multifamily side of real estate.
As an agent, my partner Jonathan buys $10, $20, $50 million apartment buildings for clients. This is stuff that hopefully we’ll be able to afford sometime but can’t right now.
I saw he was in that market, and it was somewhere I wanted to get. He had a great balance sheet but never bought a rental property. I had a lot of debt, but I had a little bit more know-how when it came to actually being a real estate entrepreneur.
So we teamed up and bought an apartment building. It’s 11 units. We still own this today. The rest is history!
Our goals now, as we move the goal post further and further, is get to 100 units. Like I said, this is the beauty of real estate. It’s so scalable.
Once you get one single family, all of a sudden you’ve socialized yourself with getting two. Then you get five. Then you meet someone who is doing retail plazas or commercial or industrial. And you think, well if they can do that, why can’t I?
You really can build something. I wanted to share this to help some people out there who are trying to get into their first property. Then maybe once you get into the first one, you can move onto multiple or even the commercial side.
I think commercial is one of the most lucrative places to be in real estate. It’s not for everybody. But especially on the apartment side, you can really scale under one roof.