Have you flipped a house before or have a rental, and you kind of feel stuck? You don’t know how to scale your real estate business because you’ve reached a point where you 1) can’t flip more houses and 2) the idea of building a larger rental portfolio overwhelms you.
Something seems to be broken. This just can’t be it. How do I scale? How do I build my passive income through real estate?
If that’s you right now, then I want to show you how I scaled beyond my house-flipping strategy with multifamily apartments.
In this article, I’ll show you why apartments aren’t an advanced strategy and how you can get started without years of prior experience.
Let’s do this.
Scaling Beyond Single-Family Investments
If you’ve been flipping houses or renting single-family homes, you’ve probably felt the frustration. The strategy that seemed so promising in the beginning suddenly feels overwhelming.
Maybe you’re stuck managing renovations or constantly searching for the next deal. You might even be wondering how to build a rental portfolio big enough to replace your income.
Here’s the truth: scaling with single-family homes is not only challenging but also unsustainable for many.
Let’s do the math.
Say each property nets you $200 a month in cash flow. To hit $10,000 a month, you’d need 50 properties. Can you imagine financing, managing, and maintaining 50 houses? It’s exhausting just thinking about it. That’s where the cracks start to show in the single-family house investing model.
Even flipping houses can be a grind. The profits are there, but the moment you stop flipping, the money stops flowing. It’s not passive, and it’s not scalable. So, how do you break free from this hamster wheel and build something that truly leads to financial freedom?
Why Multifamily Properties Let Me Scale
I faced the same struggles. I started with single-family homes, thinking they were the gateway to financial freedom. I flipped houses and built a small rental portfolio, but I quickly hit a wall. Then, in 2011, almost by accident, I bought a small apartment building.
It was a nightmare at first—managing it without mentorship or guidance—but after 18 months, something incredible happened. That property started sending me $1,500 in passive income every month, without me lifting a finger. That was my lightbulb moment.
Multifamily properties are different. They allow you to scale faster and more efficiently than single-family homes ever could. Think about it: instead of managing 50 separate houses, you could achieve the same financial goals with just a few apartment buildings. For example:
- A 12-unit property can be your stepping stone to a 20-unit, then a 50-unit, and so on.
- Within three deals, you could have 75 units—generating significant cash flow and building real wealth.
And the benefits go beyond just cash flow. Multifamily deals have built-in profit centers that single-family strategies don’t offer. These include:
- Acquisition Fees: You earn a fee (usually around 3% of the purchase price) for putting the deal together. On a $4 million deal, that’s $120,000.
- Cash Flow: Monthly income from rents, minus expenses.
- Asset Management Fees: A percentage of the revenue for overseeing operations.
- Equity Profits: When you sell the property after increasing its value, you reap the rewards.
Over five years, a $4 million deal could generate $600,000 in total profits. That’s $125,000 per year—far more than what you’d earn with single-family rentals.
How to Get Started in Multifamily Investing
The idea of buying a $4 million property might sound intimidating, but here’s the good news: you don’t have to do it alone.
Multifamily investing is a team sport. You can partner with others to divide the workload and responsibilities. This approach is often called syndication, and it’s the ultimate way to scale.
Here’s how I started:
- I shifted my mindset: I embraced the “who, not how” mentality by focusing on building a team instead of trying to do everything yourself. As Dan Sullivan’s book Who Not How explains, success comes from collaboration.
- I educated myself: I learned the fundamentals of multifamily investing by reading and attending in-person events. But I recommend using free resources to start out like my Apartments 101 Masterclass.
- I built my network: I connected with capital raisers, deal raisers, and mentors who worked with me through the process. Joining a supportive ecosystem of like-minded investors can make all the difference.
- I took action: My first deal wasn’t huge, it was only 12 units. As I gained experience, kept building a powerful team, and made connections, I was able to tackle larger and larger deals.
Final Thoughts
If you’re ready to scale your real estate business, multifamily properties are the way to go. They offer potential for growth, financial freedom, and long-term wealth. So, stop spinning your wheels with single-family homes and start thinking bigger.
Want to learn how to take the first step?
Check out my free training, Apartments 101, where I dive deeper into how to transition from single-family to multifamily investing.
Let’s make this the year you finally scale your real estate business and achieve the life you’ve always dreamed of.
To your success,
Michael Blank
