SO, HOW DO I THINK YOU MAKE MONEY IN MULTIFAMILY HOUSING???

PART II OF III... Now, let’s talk about the rents. The whole trick in making money this way is where do you build such a project. You cannot build it in any middle-class neighborhood. You have to build it in either an “up and coming” neighborhood or an established neighborhood or city that has established rents like this for many years. Those of you around the United States will recognize Beverly Hills as such a city. But, in Los Angeles County we have more than several beach communities that qualify. Manhattan Beach, Hermosa Beach, Redondo Beach, Santa Monica, and all the other beach communities going down the Southern California coast going to, including, Orange County as well. And then there is Beverly Hills, but you can also add West Hollywood and other neighborhoods in what is considered Los Angeles, like Brentwood.So, the principle of making money in real estate is giving the buyer what they want. In this case, you are targeting a certain demographic. But they do exist and there are many of them. And it is my opinion that we are starting to see the professional tenant. I read an article the other day about the “professional tenant”, and I have two definitions for them. The first is that they are professionals in what they do. They might be an attorney, an accountant, or another professional who doesn’t now have or will not have a down payment for a house and they do not mind renting. They might have other investments, maybe in real estate, but they are happy where they are.The second class of “professional tenants” is married to a lovely man or woman but is also married to their work and doesn’t have time to fix anything that broke in their residence. They feel that they cannot wait all morning at home for the plumber and they don’t want to pay a plumber an hourly rate greater than theirs. There are many apartment dwellers who appreciate calling maintenance and having something repaired while they are at work. It’s really hassle-free. You can always take your discretionary income and invest it in so many different things because, in my definition, you have that discretionary income.There is a market for the high rent luxury apartment/townhome model and it’s right here. There have to be neighborhoods and communities all over the United States that qualify for the same treatment. EVERY state and major city in the United States has such a community. It’s usually safe, maybe in a guarded or gated community, and you WILL find tenants to pay you those rents. Now, you will notice that I didn’t say exorbitant rents. I feel that you are giving value for the dollar in this case, and you are not charging $4,000 for an 800 square foot two-bedroom apartment.