Are you thinking about making the leap from investing in single-family homes to multifamily properties but you’re not sure if it’s the right decision for you to make or not? If so, you’ve come to the right place!
In this article, I will share with you several reasons why you should consider moving from investing in single-family rental properties to multifamily investment properties.
You Will Save More Time
Let’s face it, time is something that you have less of as you grow older so there’s nothing more important than being able to save more time out of your day. Right?
When you invest in multifamily properties, you’re going to save a ton of time because instead of having to manage a portfolio of investment properties with over 100 single family doors, when you own a multifamily property with 50-100 doors, you’re going to have one transaction, and one place to manage.
There’s nothing better than having to deal with one location instead of having to drive to multiple properties just to manage them. Thankfully, you will get a better ROI on your time and you will be able to simplify your life.
Have More Control Over Your Income
Besides controlling your time, you also want to control your income, right? With single-family homes, it’s more difficult to control your income because there are a lot of variables that could affect your income including if the property is vacant for any length of time.
The good news about owning a multifamily property is that if one unit is vacant for any length of time, there are always other units that are going to be occupied. Those occupied units will cover your mortgage and expenses.
In terms of the value of single-family homes, your property value will be affected by the sale of other “comparable” properties in the same area and a variety of other factors. It’s different when you invest in multifamily because a prospective buyer is going to look at the Net Operating Income (NOI), not just the value of the property. If you can drive your Net Operating Income, while lowering your expenses, this will increase the value of your property.
Better Return on Your Investment
Yes, investing in multifamily properties will save you time and enable you to control your income but another benefit that I want to write about is that you will enjoy a better return on your investment.
With a multifamily property, you’re going to get better ROI when you make improvements to the property like adding a pool or laundry room because that improvement is going to benefit all of the other units in the property.
Sadly, when you invest in improving one of your single-family properties; that investment is only going to improve the value of just that one property, instead of all of the other properties that you may have in your portfolio.
There’s nothing better about getting more ROI from making one investment rather than having to make multiple investments into a variety of single family properties.
It’s also easier to sell a multifamily investment property than it is to sell a single-family home because regardless if the multifamily property has two doors, or 200, most investors like the idea of purchasing a property that has multiple doors under one roof because more doors equals more income.
It’s Easier to Scale A Portfolio of Investment Properties When You Invest in Multifamily
Every investor is thinking about how they can scale their business to new heights and with multifamily, it’s easier to scale your business than it will be with investing in multiple single-family properties.
How? The answer is simple. Let’s say that you buy one multifamily property that has 50 units. That’s one building that’s going to need one property manager and a few maintenance techs.
When you buy multiple single homes, it’s more difficult to scale because unless those properties are in the same subdivision or city, those properties are all going to require separate property managers, maintenance technicians and potential problems.
Investing in multifamily is always easier for investors because you can get more ROI on your time and income while simplifying your life.
Not sure about the size of the property that you should buy? No problem. The good news is that you can get started with a multifamily property that’s a small as a duplex, triplex, or fourplex before moving up to bigger multifamily investment properties.
Don’t think that you have enough money to buy a multifamily property? Don’t let cost stop you from getting started! You can easily buy a multifamily property with an FHA loan these days and pay as little as 3.5% down so you shouldn’t let the price stop you from buying your first multifamily investment property.
There’s always going to be investors who advocate single family investing vs. multifamily. I always try to encourage investors to consider multifamily first because it’s a much better use of time, money and energy versus single-family properties.
Work with Me
Are you ready to get started with investing in multifamily properties but you don’t know how or where to get started?
I’m invested in over $79,000,000 in real estate projects across the United States and I can provide you with real estate investments that provide excellent ROI.
To learn more about partnering with me please click here to connect with me through my website.