It’s 9am Monday morning and you’re pulling into the office. You check your phone and you have 3 missed calls and a voicemail from your financial advisor. What could possibly be so important that he’s called me 3 times this morning?! Has my portfolio dipped again? Your heart starts racing. Your hand shakes as you pull the phone up to your ear and press play.

Hey John, it’s Tim. Happy Monday! Give me a call back as soon as you get this.

I’ve got this incredible stock.

It’s currently valued at $100 but we can buy it for $80.

I personally audited the company’s books and the valuation is spot on.

If you can come up with $20, I’ll find someone to lend you the rest.

And don’t worry, I have some people lined up to pay off the loan for you.

In fact, they like it so much they’ll pay you extra.

Every month I’ll write you a check from the profits, plus give you a tax write-off every year so you can keep more of the cash in your pocket.

On top of that I have a proven plan to increase the value of the stock by 40% over the next 5 years.

Then when we sell it, there is a legal strategy to pay ZERO capital gains tax.

What do you think?

Sounds pretty incredible right? Now this would never happen (legally) with your financial advisor because [1] any inside information that would let you buy a stock at a discount is called insider trading and will land you in jail, [2] you don’t have access to the company’s books, [3] you can’t get a tax write-off for owning stocks, [4] you have zero control over the value of your stock, and [5] when you sell your stock you pay capital gains.

But this scenario happens everyday in the wonderful world of apartment investing. Properties are bought at a discount from motivated sellers every day. In addition, the benefits of owning an apartment are considered IDEAL because they offer so many incredible benefits not available through other asset classes.

Income – Our investments produce positive cash flow for our investors from day one. We don’t speculate based on “pro forma” numbers. We buy properties based on a very conservative analysis that cash flow immediately upon the acquisition.

Depreciation – It’s not just how much you make but how much you can keep. Investors benefit from an allocation of the annual depreciation expense to reduce their taxable income. The government allows for certain depreciation write off’s that allow you to legally keep more of your money. That’s a pretty awesome benefit. (Hence, why Donald Trump likely pays zero income tax). In addition, if you sell your property and buy another property with the proceeds, you won’t pay any capital gains tax on the sale [via a 1031 exchange].

Equity buildup – Residents pay down the mortgage and increase equity for investors. As one of my mentors once told me, “I like the idea of a bunch of people pooling their money together to pay off one of my assets”.

Appreciation – While all real estate appreciates in value over the long-term, commercial real estate, which includes 5+ unit apartments, is valued based the amount of net operating income (NOI) that it produces. So if the value of a property is based on the income it produces, then we can force appreciation by reducing expenses and increasing revenue. SNA focuses on value-add opportunities within emerging markets because they allow us to force the most appreciation in the shortest amount of time.

Leverage – Lenders can finance up to 75-80% of the purchase price, which allows investors the opportunity to acquire much larger properties and capitalize on the appreciation at a larger scale.

The key to building long term wealth with apartment buildings is to buy buildings below market value, with value add opportunities in an appreciating market. If you do those (3) things you will be very successful. Contact us at SNA Capital today to learn more about investing in apartment buildings.