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#72 Why I Sold My Triplex & Fourplex to Buy 8 & 10 Units (Long Beach Market Update 2026) · Own More Doors

• 0:00
  SPEAKER_00: So uh it's early March 2026.
• 0:03
  SPEAKER_00: And so let me give you guys an update on what I see specifically here in Long Beach regarding multifamily.
• 0:08
  SPEAKER_00: So I was talking to the guys in the office, and they were saying, man, there's not a lot of inventory.
• 0:13
  SPEAKER_00: And the one thing that we were looking for is uh especially in the five plus market, so this is five units and above.
• 0:18
  SPEAKER_00: It's what they call uh commercial, but they're not commercial units.
• 0:22
  SPEAKER_00: It's residential units, but they're five units and above.
• 0:24
  SPEAKER_00: The financing is going to be different.
• 0:25
  SPEAKER_00: So we were expecting to see an uptick in inventory.
• 0:28
  SPEAKER_00: And one of the things we've been telling you for a couple years now is a lot of the loans that were taken out five years ago are adjusting up or coming due, which creates tremendous opportunity because we've seen a couple things happen.
• 0:42
  SPEAKER_00: Um, the market and the five plus market has taken a dip up to like you know 20 to 25% discount from their um like the peak.
• 0:51
  SPEAKER_00: So values are coming down.
• 0:53
  SPEAKER_00: And so let me tell you some of the things that we've been doing, like specifically I've been doing.
• 0:56
  SPEAKER_00: So I've been telling everyone who wants to listen is this is the time to sell your single family home, investment home, not your personal home, just your investment home.
• 1:05
  SPEAKER_00: If you have an investment condo, an investment duplex, a triplex, fourplex.
• 1:09
  SPEAKER_00: And the reason why is that you could still sell those types of properties at a premium.
• 1:14
  SPEAKER_00: You're still gonna get a really good price there.
• 1:17
  SPEAKER_00: Those are not selling at a discount.
• 1:18
  SPEAKER_00: There's a lot of reasons why, but that's not that important right now.
• 1:22
  SPEAKER_00: And what I'm telling people is take that equity.
• 1:24
  SPEAKER_00: So whether it's 300,000, 400,000, or even higher, and let's roll that into something that's eight units, 10 units.
• 1:31
  SPEAKER_00: And the reason we're doing that is very rarely in a kind of a business cycle, a market cycle, if you will, do you get to sell at the top and then buy at the bottom.
• 1:43
  SPEAKER_00: And that's exactly what's happening because normally what ends up happening is you sell at the top, you buy at the top.
• 1:49
  SPEAKER_00: Okay, it still might make sense, but in this case, it's like the perfect storm, right?
• 1:53
  SPEAKER_00: It's a perfect storm.
• 1:54
  SPEAKER_00: So let me give you an example of what I'm personally doing on my investments.
• 1:57
  SPEAKER_00: I um had a triplex that I bought right right in uh 2020, no, 2003, so maybe a year before I graduated college.
• 2:08
  SPEAKER_00: And luckily, like I had mentorship and uh who was Mark Milan who told me, hey, buy that triplex.
• 2:14
  SPEAKER_00: And so I bought it and I managed it and kind of dealt with all the issues that it gave me and the tenants and move outs and evictions because it's not easy.
• 2:22
  SPEAKER_00: This is this is a job, right?
• 2:23
  SPEAKER_00: It's a job to own rental units.
• 2:26
  SPEAKER_00: But fast forward till today, and um a few months ago, I decided to sell it.
• 2:30
  SPEAKER_00: And with that, with the with that profit, I was able to buy an eight-unit building.
• 2:35
  SPEAKER_00: Now the eight-unit building is in a better neighborhood, higher income.
• 2:38
  SPEAKER_00: Um, so a few of the metrics.
• 2:40
  SPEAKER_00: So um it had a better gross rent multiplier, better cap rate, better price per square foot.
• 2:46
  SPEAKER_00: Everything about it, better price per unit, everything about it was better.
• 2:49
  SPEAKER_00: So now I I have this eight-unit building, I'm really happy with it.
• 2:53
  SPEAKER_00: Um, is life perfect?
• 2:54
  SPEAKER_00: No.
• 2:55
  SPEAKER_00: Turns out it needed a new roof.
• 2:56
  SPEAKER_00: Now I knew it needed a new roof, and we just got through our first rainy season in Long Beach, and property manager contacts me and says, You need a new roof.
• 3:05
  SPEAKER_00: I'm sorry to report.
• 3:06
  SPEAKER_00: And I said, Don't be sorry.
• 3:08
  SPEAKER_00: I knew it needed a new roof.
• 3:10
  SPEAKER_00: I was hoping that I could get another year or two out of it, but if I need a new roof, so be it.
• 3:14
  SPEAKER_00: Um, so that's example one.
• 3:16
  SPEAKER_00: Now, our second example is I like the process of selling a three unit, doing what's called a 1031 exchange, so delaying paying profits on the equity and buying the eight unit.
• 3:29
  SPEAKER_00: So then what I did is, but what else do I have?
• 3:31
  SPEAKER_00: So then I had a four-unit building.
• 3:33
  SPEAKER_00: And that one I owned with two buddies.
• 3:35
  SPEAKER_00: So I called them up.
• 3:36
  SPEAKER_00: I said, guys, I know this is gonna sound crazy because the four-unit building was making us money, it's making us cash flow.
• 3:40
  SPEAKER_00: And they're like, Why would we get rid of this?
• 3:42
  SPEAKER_00: Look at our interest rate.
• 3:43
  SPEAKER_00: Why the hell would we do this?
• 3:45
  SPEAKER_00: And I said, Let me show you what we could buy.
• 3:48
  SPEAKER_00: And so they they trusted me, and so we put the property, we didn't even have to put it on the market.
• 3:53
  SPEAKER_00: I we we have a database of investors, of buyers, and so we were able to find someone who was gonna buy it, uh, give us the price in terms that we wanted.
• 4:02
  SPEAKER_00: And with with that profit, I was able to roll it into a 10-unit building.
• 4:07
  SPEAKER_00: And so, right now I'm buying a building on on Redondo.
• 4:10
  SPEAKER_00: So, again, better price per square foot, better price per unit, uh, better cap rate, better gross rent multiplier.
• 4:18
  SPEAKER_00: So, all the metrics are checked off the box, and now we're we're pretty close to closing that property.
• 4:24
  SPEAKER_00: And so, how's the market?
• 4:27
  SPEAKER_00: The market is um really good if you're in a position to buy bigger units.
• 4:32
  SPEAKER_00: It's not to say that you shouldn't buy a fourplex.
• 4:35
  SPEAKER_00: I still believe in that from the very beginning.
• 4:36
  SPEAKER_00: I told people, hey, fourplex is kind of the gateway property to get started with.
• 4:41
  SPEAKER_00: There's a lot of opportunity, it's easy to understand.
• 4:43
  SPEAKER_00: Um, but if someone has a bigger down payment, I'm telling everybody, hey, let's not mess around with the small stuff, let's go after the eights, the tens, the twelves.
• 4:54
  SPEAKER_00: And again, if someone has a million dollars, then yeah, we're now looking at a 16-unit building, we're we're looking at bigger stuff, and so that's where I see opportunity.
• 5:03
  SPEAKER_00: There's a couple things.
• 5:04
  SPEAKER_00: Um, cap rates have been going up.
• 5:07
  SPEAKER_00: As cap rates go up, values come down.
• 5:09
  SPEAKER_00: Um, so if you're a buyer, this is great.
• 5:11
  SPEAKER_00: If you're an owner, may not be good news.
• 5:13
  SPEAKER_00: And so a couple things for the rest of the year.
• 5:16
  SPEAKER_00: Um, interest interest rates have dropped a little bit and inventory is not as high.
• 5:21
  SPEAKER_00: I still expect more properties to be coming on market here soon.
• 5:25
  SPEAKER_00: Um, everyone I know, whether you're a buyer or a seller, everyone's like crossing their fingers waiting for interest rates to drop.
• 5:33
  SPEAKER_00: Why?
• 5:34
  SPEAKER_00: If you're a seller, interest rates dropping means that your property is now worth more.
• 5:39
  SPEAKER_00: If you're a buyer, your perception is, well, I'll get the property at the same price, which is not true, and now I get a lower interest rate.
• 5:48
  SPEAKER_00: That's it's not true.
• 5:49
  SPEAKER_00: You'll get a lower interest rate, but you're not gonna get the property, uh, the price that you want, because the seller's gonna jack up their price.
• 5:55
  SPEAKER_00: And so everyone on the buy side, on the sell side is like crossing their fingers.
• 5:59
  SPEAKER_00: We want interest rates to drop.
• 6:00
  SPEAKER_00: But here's what I want you guys to know.
• 6:03
  SPEAKER_00: Uh, Chris Thornburg, economist, um, I interviewed him and then I even had him um be our keynote speaker at our event.
• 6:12
  SPEAKER_00: He's telling us that expect interest rates to go up.
• 6:16
  SPEAKER_00: That all the metrics are telling us interest rates are gonna go up.
• 6:20
  SPEAKER_00: So, what do you do with this?
• 6:21
  SPEAKER_00: What do you do with this, right?
• 6:23
  SPEAKER_00: If you're a seller and you were thinking about selling and interest rates could go up, I don't know.
• 6:28
  SPEAKER_00: This might be the time.
• 6:30
  SPEAKER_00: If you if you're not happy with your price now and interest rates are maybe gonna go up, I'm not saying that that that's correct, but if they do, what's that gonna do to your value?
• 6:39
  SPEAKER_00: It's gonna drop your value.
• 6:41
  SPEAKER_00: Um, if you're a buyer and interest rates go up, well, you're not gonna be happy about the higher interest rate, but you might be happy that might that might dip the price.
• 6:49
  SPEAKER_00: And so it just kind of like where are you at in the process?
• 6:52
  SPEAKER_00: I'm I still believe um there's a couple other things that Christopher Thornburg said on um on the stage.
• 6:59
  SPEAKER_00: He said, um banks want to lend.
• 7:02
  SPEAKER_00: So it's right right now, it's it's a period of of they want to lend, and if if you're in a position where you're an investor, you're an entrepreneur, this is the time to take advantage of that.
• 7:13
  SPEAKER_00: Banks want to lend, let's go, let's go take out loans.
• 7:16
  SPEAKER_00: That's the way that I believe.
• 7:17
  SPEAKER_00: Okay.
• 7:17
  SPEAKER_00: Uh so there's that.
• 7:20
  SPEAKER_00: We still have a high housing prices, um, rents are still expected to go up, even though there's been a small dip.
• 7:26
  SPEAKER_00: And um employment's good.
• 7:29
  SPEAKER_00: And so the the the reasons to buy multifamily are still still super strong.
• 7:37
  SPEAKER_00: It's still a good time to get in.
• 7:38
  SPEAKER_00: Values are, in my opinion, great.
• 7:41
  SPEAKER_00: Are they gonna get better?
• 7:42
  SPEAKER_00: I don't think so.
• 7:43
  SPEAKER_00: I really don't think so.
• 7:44
  SPEAKER_00: I think right now is the time to really buy.
• 7:46
  SPEAKER_00: It's what I'm buying.
• 7:47
  SPEAKER_00: Now it's interesting.
• 7:48
  SPEAKER_00: Um, you might be hearing from another broker, and they don't they may not own any units.
• 7:53
  SPEAKER_00: I'm telling you, this is what I own, this is what I'm doing, these are the moves that I'm making.
• 7:57
  SPEAKER_00: So if you're a buyer who wants to get started, maybe level up on their units, um, maybe own more doors, um, please reach out to me.
• 8:07
  SPEAKER_00: If you're a seller and you're like, man, uh, I don't like the direction this is going, the values have been coming down.
• 8:14
  SPEAKER_00: Give me a call and let's have let's have a conversation.
• 8:18
  SPEAKER_00: I'm not gonna oversell you or convince you that the best move is to list your property.
• 8:21
  SPEAKER_00: That may not be your best move.
• 8:23
  SPEAKER_00: Um, but let's have that conversation.
• 8:24
  SPEAKER_00: So, anyhow, thanks for watching and make sure to like, comment, and subscribe.
• 8:29
  SPEAKER_00: Until next time.