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By the time I got started with multifamily investing, I had flipped about 3 dozen houses and started several businesses. I thought my flipping career would serve as a useful stepping stone to the big leagues.

I was wrong.

First, I got woefully little credit for my prior real estate experience.

I was surprised that the vast majority of my single family house (SFH) investors did NOT want to invest with me in apartment buildings. They either didn't have the capital or didn't like their money tied up for a longer period of time. Whatever the case, only very few investors made the transition with me.

Not only that, but when I “bragged” to commercial real estate brokers, seller, and lenders about my track record as a house flipper, they yawned. Despite my best efforts, they viewed me as a multifamily (MF) newbie and treated me as such.

I was essentially starting over from scratch.

Maybe the SFH investing thing was not a stepping stone at all. In fact, maybe it was actually a distraction.

I've come to the conclusion that SFH investing is not necessary to get into multifamily investing. If you want to get into apartment buildings, then do it. Don't get into a “temporary” other strategy.

Most newbies get into SFH investing for the wrong reasons. They believe that they need to cut their teeth with SFH investing before getting into multifamily properties.

They are wrong.

If you closely examine WHY newbies say they should get started with SFH, the real reason they think they should do it is to get COMFORTABLE enough to get into multifamily investing. In other words, they want to expand their comfort zone with SFH investing.

I'm all for expanding your comfort zone. But you don't need to “waste” several years of your life pursuing a DISTRACTION only to expand your comfort zone.

There are other, more efficient ways to achieve the same thing.

If you know apartment building investing is the strategy to help you achieve your financial goals, then don't make the mistake of going the SFH route first. It won't actually serve you in the way you think and it will in fact delay your goal of financial independence.

Please don't misunderstand me. There is nothing wrong with SFH investing, and I'm not saying you shouldn't invest in SFH's. I know a very accomplished investor whose strategy is specifically to build up a portfolio of SFH's. I'm just saying, do it INTENTIONALLY. Don't do it for the wrong reasons.

And if you're primary reason is to “get comfortable” enough to get into apartment building investing, then maybe you should examine your plan.

You absolutely have to expand your comfort zone to play the game at a higher level with multifamily. But do it in the way I describe in this article: don't waste several years pursuing a strategy that won't directly get you to your goal.

Read the entire article on Bigger Pockets here.







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