The complete Guide To Buying And Selling Apartment Buildings

323 Pages·2016·2.4 MB·English

by  Bergers Steve.

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THE COMPLETE GUIDE TO BUYING
AND SELLING APARTMENT
BUILDINGS
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The Complete Guide
to Buying and Selling
Apartment Buildings
Second Edition
STEVE BERGES
John Wiley & Sons, Inc.
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Copyright © 2005 by Steve Berges. All rights reserved.
Published by John Wiley & Sons, Inc., Hoboken, New Jersey.
Published simultaneously in Canada.
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The advice and strategies contained herein may not be suitable for your situation. The publisher is not engaged
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Library of Congress Cataloging-in-Publication Data:
Berges, Steve, 1959–
The complete guide to buying and selling apartment buildings / Steve Berges.
p. cm.
Includes index.
ISBN 0-471-68405-8 (pbk.)
1. Apartment houses—United States. 2. Real estate investment—United States. 3. Apartmetn houses—
Purchasing—United States. 4. Residential real estate—Purchasing—United States. I. Title: Guide to buying
and selling apartment buildings. II. Title: Buying and selling apartment buildings. III. Title.
HD259.B47 2004
333.33'8—dc22 2004042246
Printed in the United States of America
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D E D I C A T I O N
It has been said that behind every good man is a good woman. This state-
ment holds true for me, except that in my case, there have been two good
women. This book is dedicated to the two women who have had a most
profound influence on my life. They are my mother, Eleanor May Miller
Berges, and my wife, Nancy Anne Thompson Berges.
In memory of my mother, thank you for your kind words of encourage-
ment throughout my childhood years. I will always remember your exam-
ple of dedication and perseverance to attain your goals. It was you who
convinced me of my self-worth, and it was you who taught me to believe
in myself. Your example will forever live in my heart.
Tomy beloved wife, thank you for your continued support over the years.
While my mother laid down the torch of life, you have picked it up in her
stead. You are now the driving force in my life. It is you who carries on
her tradition of love, confidence, and inspiration. It is you who gives me
strength when I need it most. Of all the things God created, truly you are
the most beautiful.
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A C K N O W L E D G M E N T
I wish to express my sincere thanks to my wife, Nancy, for her editorial
support during the production of this manuscript. Her wisdom and
insight have contributed significantly to the successful completion of this
book.
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C O N T E N T S
CHAPTER 1 Introduction to Multifamily Ownership 1
Introduction 1
Holistic Approach 2
Background 4
Market Outlook 6
Regional Trends 9
CHAPTER 2 Advantages of Multifamily Ownership 13
Time and Efficiency 14
Market Liquidity 15
Transaction Costs 16
Concentration of Units 17
Management and Labor Considerations 17
Tax and Record Keeping Considerations 18
Divestiture of Property 18
CHAPTER 3 Bridging the Gap 21
Strategies 22
Leverage—The OPM Principle 23
Clearly Defined Objectives 24
Maslow’s Hierarchy of Needs 27
Conquering Your Fears 29
CHAPTER 4 The Value-Play Strategy 35
Buy and Hold versus Buy and Sell 36
Ten Ways to Create Value 39
Diamonds in the Rough 47
How to Tell a Diamond from a Lump of Coal 61
CHAPTER 5 Establishing Your Niche and Locating Properties 69
Establishing Your Niche 70
Availability of Resources 70
Property Size 71
Property Age 74
Holding Period 79
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