One way to start is to purchase a duplex, triplex, or four-unit property in which you live in one unit and rent out the rest. 2-4 unit properties are often easier to finance than 5+ units, and it's a good way to become acquainted with all the issues that are involved in managing income property. Then, if you decide that owning an apartment building isn't for you, it'll be easier to sell the 2-4 unit property than it would be to sell 5+ units. I purchased my duplex in 1997 with 10% down (with PMI) and then had the PMI payment removed in 1999 when property values went up and I had 20% equity in the duplex. I've had ups and downs but have learned a lot from owning this duplex -- and I've built a good chunk of equity as well.
Aug 27, 2009