How to Analyze a Multifamily Property & What Could Kill a Deal

Want to know how to analyze a multifamily property? Maybe you’ve analyzed duplexes, triplexes, quadplexes, or even ten-unit apartment complexes before, but what about the big deals? We’re talking about multi-million dollar multifamily investments, with hundreds of units, large debt and equity structures, and many, many small pain points only experienced investors would notice.

If you’re looking for an in-depth overview of how to find, analyze, and buy a large multifamily property so you can build passive income and serious equity growth, then Andrew Cushman is the man to talk to. Andrew is so good at what he does that he's partnered up with BiggerPockets Podcast host, David Greene, to invest together.

In Andrew’s previous episode, he touched on the “phase I underwriting” that comes with analyzing a multifamily deal. In this episode, Andrew focuses on what investors should do after they’ve triaged their deals and are left with only the best in the bunch. Andrew spent years worth of time analyzing deals to come up with these eight steps. He shares them today so you can have less headache and more investing success than when he started!

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Episode 586

00:00 Intro
02:26 Quick Tip
03:14 Recapping Phase I Underwriting
10:52 Step 1. Rent Increases
17:50 Step 2. Loss to Lease
29:43 Step 3. Debt Quotes & Loan Terms
45:58 Step 4. Insurance Quotes
52:34 Step 5. Property Taxes
58:04 Step 6. Property Manager's Opinion
1:00:59 Step 7. Renovation Budget
1:05:49 Step 8. Follow Up On P&Ls
1:11:20 Reviewing the 8 Steps of Multifamily Underwriting
1:15:22 Andrew's Current Deals
1:18:15 Phase 3. Making the Offer!

[JeffWybo]

I love to know my ARV’s and buy based on unit pricing. I’ve been able to acquire over 250 units and am currently BRRRR’ing them. Full time, managers and contractors on salary. Love MultiFamily!

[damesmiller]

it would be really helpful for first timers, if there were a glossary for multi fam financing and checklists.

[niyainc.-wealthrealestatet]

Thank you BP! I am actually planning to vlog my process of selling my condo, evaluating properties, and purchasing a fourplex with an FHA in a high cost area (L.A) with the goal of buying bigger properties

[helloromie]

Even on full screen, the slides and charts are very blurry 30:30 The message and information is very appreciated though. Thank you Andrew Cushman.

[nico_gg_]

I am dead! I can’t believe there is so much I had no idea of. That’s why I love this podcasts

[AlejandroAlvarezMitre]

Great episode! Would you invest in hurricane zones such as Houston or Floridas' cities? What are your thoughts!? Best!

[samyin]

Absolutely perfect. Thank you for the episode. I will use a few of these in my future underwriting. Please do more of these.

[hbcomcn]

Thank you both, this is like in the University, you finally meet that professor makes you feel I am educated!

[fabiandennis]

you should Take all stats snag the Title Upload the B4 and After Pics of the property turn your real estate portfolio... into An NFT monopoly board game Card ErTH Globe Edition.. hook it up with 7 percent and i only work weekends.. lol IP

[GR..]

Notes: 9:23, 15:59, 17:50, 29:43, 45:58 <watch entire segment, 55:00

[gregwood]

you guys should get Alex Hormozi on the show, he would be super interesting to listen to on his take on multi family investing.he loves liquid cash, and deploying money for his businesses, so he needs access to his funds asap....i would love to learn from alex!!!

[RobWilliams]

David, I mentioned this to you before, your mic amp or computer is set too hot and you are distorting easily. You can also put on a limiter. Just trying to help.

[BJNeyer]

That's called adjusted valuation. In Kansas, residential propety is (Market value * 11.5%) * Mil levy = taxes due. If you have an empty lot, residential or not, you're taxed at 12%. Commercial is taxed at 25%. Kansas actually throws a real curve ball into the calculation. They exhempt the first $20K of residential value from the base school mil levy of 20 mils. They are going to increase that to $50K. Forget math, you need to have a degree in Calculus to figure Kansas property taxes.

[dushyank]

Fantastic video, watched the entire video and learned something every second. These guys knowledgeable, intelligent, great communicators, great presence of mind. I will owe a lot my successes to these guys.

[fabiandennis]

is this like High School Where you change ya Grade from F to B+ or C+...Do tryna figure this all out OK OK Crypto wise this is like a Smart Contract but it the actual county you were just Updating the morgage so that the note would Clear Customs/them grading how risky you are as a borrowerer but Future Dated to release title once time expires and numbers or margins must be exact

[marcuslittle]

Is that a pair of shoes in David's trophy case? I'm sure there's a real estate metaphor here somewhere.

[mkrashid]

Guys...Very Solid Information!! Thanks for Sharing!!

[SSB-gqtu]

David your a very affective versatile speaker sir good job

[bronjames]

Would you buy a multifamily with 50$ of negative cashflow on a house hack. If you are technically paying lower rent yourself.

[hermanhaertner]

Real Estate expansion is helping fuel the resource market. Uranium and Clean Nuclear Energy is the place to be. It's almost ready to be banned by USA and RUSSIA because of the war. And it is a clean energy that both republicans and democrats actually agree on. If you are not familiar with the sector, then grab an ETF like URA or URNM. Enjoy! It's just another option to add to the portfolio.