The 6 Steps to (Almost) Perfect Multifamily Underwriting

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Multifamily underwriting isn’t a commonly used term within the residential world. If you’re used to dealing with single-family homes, duplexes, triplexes, or quadplexes, you’ve probably done real estate underwriting to some degree, but you’ve called it “real estate analysis”. In both scenarios, investors are looking at what they’ll make on a deal, how much they need to invest, and what exit strategies they have.

But, in a hot housing market, like we’re in today, by the time you analyze a deal, a deal may already be gone. You need a way to quickly sort deals into the “pursue” or “dump” piles, and Andrew Cushman, expert multifamily investor, may just have the solution for you. Andrew has been on the BiggerPockets podcast before and manages over 2,600 units, so he definitely knows what he’s talking about!

Today, Andrew showcases the phase one underwriting he uses to decide quickly on deals, as well as the four levers to look at before even getting into underwriting. His system can save you hours, or even days, if you’re a full-time investor, and it helps rookie investors quickly analyze deals so they can get into the game. Now, residential owners can transition into commercial real estate with better scale and bigger profits.

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Episode 571

0:00 Intro
4:12 Quick Tip
5:32 2,600 Units in 10 Years
10:50 Screening Your Properties
16:03 The 4 Levers of a Profitable Property
36:48 6 Steps Before You Submit an Offer
1:03:01 Deal Deep Dive
1:13:12 Finding & Investing in Great Deals
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INSANELY valuable!!! I feel like I should have paid AT LEAST $100 — or $1000 — to listen to you and Andrew share the inside scoop and process.

And what an amazing deal. I’d love to hear where this deal is at now.

lailaatallah
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Cap Rate simplified I have been listening to great number of videos but no one had to simplify it in this manner. Now I understand learning is a process.

lunganikhubone
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I missed this initially, but so glad I found it. Thanks for the change in content. Getting into specific processes raises this newbie's knowledge and is helping me "slay dragons" that are between me and the deals I should be hunting.

srwimpy
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Amazing episode!!! Best episode I've heard across diff content channels in a while. Please have Mr.C back monthly or quarterly!!! Thx again!

BigBoonTheory
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It is amazing how so much value is available on YouTube for free, thanks guys!

yeitpoq
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Thanks BP I’ve been listening daily for the past month I’ve been thinking listening learning and dreaming lol everything real estate
Turns out my neighbor (i live in a mh park) is selling his 1995 mobile home so this past weekend me and my uncle went to check it out (he knows everything construction) I told my neighbor that I’d make his problem my problem 😉
Normally I don’t like partnering with friends or family but he’s one of the few I trust anyway I made him a cash offer and today he said my offer works so he’s looking to move out by June because he’s getting married and he’s moving in with her
The house needs a lot of work but mostly cosmetic I’m thinking we can 3x the value …I’ll be posting videos of this journey
My plan is to flip it since it’s on a park
Edit: he also asked me if I’d be interested in buying his daughters attached house (half house) so I think that’s interesting and excited for the future

Rosicrisp
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Thank you for this awesome video! Where are you plugging your numbers into? I'm looking for a good underwriting spreadsheet. I also searched for podcast 279, but I'm not finding it. Is there a link to it?

awilks
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This was a really great big picture episode with solid tips that would fit in 3x5 index card

toddsmith
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Spectacular video guys..thanks for posting!

HardwoodFloorRefinishing
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Hey guys what's up I'm a big fan of your podcast I listen to it everyday and yeah I got a few properties now I want to get properties financed but the banks in my local area all of them say no to me you guys have any ideas on how to get lenders to finance my projects

felicianoarredondo
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Such a great videooo!!!
Love Andrew Cushman!!!

tiktokdj
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we need to know the water bills, trash service, insurance, elec/gas common areas, gardner/snow remove, rental tax, what cap improvements you did last yr, things I dont know . as rents taxes manager I can figure myself what I want to put away as vacancy, future improvments,

youtubecarspottersguide
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Great tips! Hoping to get into multi family some day but who isn’t

jakemillerdoesmoney
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The Keanu Reeves is a great analogy. He came into work one day and he is extremely, extremely nice.

RobWilliams
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4, 576 phone calls, that’s almost 20 calls a day in a span of 3 months. Definitely doable if cold calling is the move.

IRDC
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you need a white board. period. walk through the deal on paper and plug in example numbers!! PLEASE!!!

ramobokid
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I haven’t understood why some prefer low cap rates—as though a high cap rate is a red flag. Anyone understand this? I’m looking at a multi-family property that has an awesome 17% caprate.

Heatherbailey
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Consider a whiteboard. Use %s vs. $s.
Lil investors don't get $49M off market deals 😆.

Ricocase
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14:05, what is “phase 1 underwriting”?

BiggCope
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Idk why but the sound bothered me in this video and I had to leave 5 minutes in /:

BigMathson