MFREE 108 Trailer # 3 with Axel Ragnarsson: Are You Locking In Your Wins on Day One?

Aloha, It’s Shelon "Hutch" Hutchinson here! If you’re enjoying 'The Multifamily Real Estate Experiment' podcast, please like, comment, and share our episodes to help us reach and inspire more people. Thank you for your support!

In this segment, Axel Ragnarsson lays it out plain: the most important move in a real estate deal isn’t mid-renovation or at the sale—it’s on day one when you buy.

He breaks down:

 👉 The three key moments that shape a deal’s returns

 👉 Why the purchase price outweighs almost every other factor

 👉 How buying below market creates a built-in safety net for LPs

 👉 Why a strong cost basis gives you room to breathe when things don’t go to plan

It’s a simple but powerful reminder—start strong, and the rest of the process gets a whole lot smoother.

#BuyRight #InvestorMindset #DeRiskYourDeal

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Episode Transcript

xel Ragnarsson1 (00:00):
The day that you buy and you lock in your
basis in terms of what did youpay for the property is the most
impactful financial decisionfrom a mathematics standpoint in
the entirety of the investingprocess, right?
So be because that's the biggestnumber.
If you're gonna spend a hundredthousand dollars per unit, you
know, and$10,000 in closingcosts per unit, I mean, that's,
that would be really high.
But just for round numbers, youknow, and you're at 1 10 cost

(00:21):
basis per unit, you're probablyonly gonna spend in multifamily
anywhere from 5 grand to 20grand just for round numbers on
the unit in renovations.
Right?
I mean, it's a small fraction ofcompared to the purchase price.
So when you're able to reducethat to 90 k, you know, 10%
below market, 90 K instead of ahundred, that's a massive delta
that.
Drastically impacts your returnsdown the line as an investor.

(00:44):
So not only do you, you know,obviously you lock in the
ability to earn higher returns,but you're also de-risking the
remainder of the process interms of, okay, you went over a
little over budget on yourrenovations.
That's not the end of the worldbecause you bought it at the
right price and you created abuffer there.