Rule #1: Buy to hold forever. Buying for the short-term means that you have to be able to predict markets. The rich buy and never sell
Rule #2: No negative cash flow. It costs about 40% of market rents to run a building effectively. If you own an “alligator”, you must be depending on appreciation – so see rule #1
Rule #3: No adjustable or variable note mortgages. They go up and cause negative cash flow. See rule #2
Rule #4: No balloon payments. They cause you to have to re-finance in an unknown mortgage market, and you will be stuck with a variable loan. See rule #3
Rule #5: Buy in areas where you don’t have to collect rents with a gun. Who needs the pain?
Rule #6: Buy local. When you buy out of state, you are going to pay $45 to change a light bulb