How do I buy my first apartment building in Los Angeles?
Most first-time LA multifamily buyers start with a 4-to-16-unit building priced from roughly $1.5M to $4M, put 30–40% down on agency or bank debt, and buy in submarkets where the numbers still pencil — not where they wish they could live. The process: define a buy box (submarkets, unit count, price band, cap rate floor), get pre-underwritten with a multifamily lender, then look at real deals with published financials until you can spot a mispriced building yourself.
The mistakes that cost first-timers money.
Underwriting the seller's expenses instead of your own (property tax resets at your purchase price under Prop 13); assuming RSO rents reach market on a schedule you control; ignoring the physical items that eat year-one cash flow — roofs, sewer lines, seismic status; and buying a "deal" in a submarket you never walked at night. Every one of these is avoidable with honest numbers up front, which is why I publish full rent rolls and both cap rates on my listings.
House-hacking the small stuff.
Owner-occupying one unit of a 2–4 unit building unlocks residential financing with much lower down payments — a legitimate first rung. The math is different (you are buying a home plus income, not a pure investment), but it is how a meaningful share of LA's small-building owners started.
How much do I need down for an LA fourplex?
Investor purchases typically need 25–40% down depending on the lender and the building's income. Owner-occupied 2–4 unit purchases can go far lower with FHA/conventional residential loans.
What cash flow should I expect in year one?
On in-place rents at today's caps, often thin to slightly negative after real reserves — LA buildings are bought for the rent trajectory and the land. If someone promises fat day-one cash flow, check whose expense numbers they used.
SHAYA LOWENSTEIN · LYON STAHL INVESTMENT REAL ESTATE · DRE #01942326 · (323) 944-2221