Chapter 1
AN INTRODUCTION TO MULTIFAMILY
PROPERTIES
“A decision is what a man makes when he can’t get anyone
to serve on a committee.”
—FLETCHER KNEBEL, BEST-SELLING AUTHOR
There are a lot of ways to invest in real estate, such as:
• Buying single-family houses
• Buying storage units
• Buying office buildings
• Buying mobile homes
• Flipping houses
• Building skyscrapers
• Buying/building large apartment complexes
• Buying/building small multifamily real estate
And you know what? There are many highly successful people in
all these niches. That’s the great thing about real estate—the
plethora of choices. But that’s also the dangerous thing about real
estate: so many choices!
As business author Seth Godin once said, “In a world where we
have too many choices and too little time, the obvious thing to do is
just ignore stuff.” When faced with the hundreds of different paths
one can take to build a life of wealth and happiness, many people
simply ignore them all, give up on their dreams, and go back to
doing what they know: watching television, eating bad food, and
hoping the government takes care of them in the few years between
retirement and death.
But not you.
After all, you’re reading a book on buying small multifamily real
estate, so the topic obviously pulls at you—and for good reason!
Multifamily real estate is one of the greatest investments someone
can make and one of the best ways to begin building serious wealth
and long-term income.
This book is designed to help you do just that. But first, let’s get
on the same page.
Defining Multifamily Properties
Multifamily. Multi-unit. Multi-dwelling unit. Apartments.
Complexes. Flats.
Many different names, but they all refer to a type of real estate
that we’ll call “multifamily” throughout this book. A multifamily
property is a singularly owned property that contains two or more
residential housing units. Each residential area contains, at
minimum: a bathroom, a kitchen, and a place for a bed.
Multifamily, therefore, could refer to a five-hundred-unit
apartment complex in the suburbs, a duplex in the city, or a
fourplex in the country. Multifamily properties come in all shapes
and sizes: large buildings, small buildings, and even separate
buildings on the same lot. My first multifamily property, the one I
mentioned in the preface, contained two single-family houses
located on one city lot, separated by a driveway and some dirt and
grass.
I also own a three-unit and a four-unit with similar setups.
Additionally, I have a five-unit that is located in one giant square
building. Then there is the triplex I bought with one unit upstairs,
one unit on the main floor, and one in the basement with a
completely separate vacation-rental unit in the backyard.
Or take, for example, a property I own that contains fifty
different mobile home units, each home independently owned by a
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