Why I Quit Single-Family Home Investing and Upgraded to Apartment Complexes

My first real estate investment ended in a whirlwind of stress that ultimately ended up with people marching outside the property with guns. ??

After 3 years of on-time rent payments, in January ‘22 they just stopped paying.

It wasn’t all roses and sunshine up to that point, either. Many broken items in the duplex had to be tended to. A windstorm took down a tree and (thankfully) only ruined the neighbor’s fence – that could have ended much worse.

This property was 1500 miles from where I lived, so I relied solely on the local Property Management (PM) company to handle all the issues.

Now, back to the payments…

The PM was working with the tenant on government relief funding. Post-COVID, there were several options, and it took nearly a month and a half.

At this point, I decided to sell, to pursue syndications.

I hired a RE agent who specialized in investment properties.

The agent was at the property the next day (unannounced) to look at the exterior.

Agent: Flint, did you know your tenant runs a geriatric Alzheimer’s care facility out of your duplex?

Two days later my agent and PM walked into the property. The lower unit had 2 beds per room – 3 bedrooms, 6 beds total.

The single tenant originally rented both units as she was the caretaker of her two elderly aunts. She lived in the upper unit, and they lived in the lower unit.

This was all a lie from the start.

And, my PM, after 3 years of managing it, NEVER . ONCE . NOTICED!!!

In hindsight, the PM is either completely incompetent, overly negligent, or they were in on it.

We found out the tenant was charging $3000 per bed, per month.

The total rent I charged for the duplex was $1800/mth.

And she couldn’t pay the F’ing rent?!?!

Needless to say, I was done and wanted to sell.

Long story short: My agent worked some magic, found a cash buyer and sold it in less than 30 days.

5 days after closing, I get a text from my agent.

“Flint, you got out just in time. The tenant had stopped paying her caretakers a couple of months ago, and they were marching outside the property with guns, demanding paychecks.”

-

In real estate, it’s not about ‘if’ something will happen; it’s a matter of ‘when’.

I learned a lot from the school of hard knocks.

Ultimately, I made ~$50k on the property. I bought it for $80k and spent $30k to renovate into a livable condition.

-

Now I help others invest with teams of experts in apartment complexes. You get all the benefits of owning real estate without having to be the landlord and benefit from economies of scale.

Passive investing in commercial real estate offers a compelling alternative to traditional approaches. It aligns perfectly with the needs of busy professionals like us who value our time and mental well-being as much as financial returns.