One apartment building. Three different investors. All three thought they’d made a smart investment, but each was surprised at how smart!
When Dave Tesch sold a 5-unit apartment property in Clinton Township for him in 2017, the happy owner reaped a nice profit for the years of his investment.
In December 2018, the buyer of that building—wanting more time for another business interest—asked Dave to sell it. Dave did, delivering him a nearly 10 percent profit for his year-and-a-half-long investment.
Early this fall, the 2018 buyer—ready for less property-management responsibility and more time with his family—returned to Dave, asking that he sell the property again.
In the thick of a pandemic, Dave kept his finger on the pulse of market conditions and knew the demand for apartments remained strong. Within the first week of listing the property, he had 5 offers for the seller to choose from. Thirty-six days later, Dave closed the deal with a qualified, all cash investor who offered nearly 10 percent above what the seller paid at the end of 2018.
In three and a half years, this small apartment building appreciated almost 20 percent. The current owner could easily see a comparable return on his investment.
This listing is not unique. While some other property types have suffered in 2020, multi-family properties have continued to gain value. It’s a case of the simplest economics: The demand for apartment units is growing; the supply is not. And as investors rightly see, people will always need a place to live.
Dave has investors calling him for apartment properties to buy. If you own one and want a surprisingly smart return, call Dave today.
