Over the years, multifamily homes have been gaining the interest of first-time home buyers as a good real estate investment.
It’s easy to explain this sudden interest in buying multifamily homes.
It’s a good source of income. The owner can rent out unit or units, and keep one to himself. Thus, the property pays for itself.
- Cash flow generation
For most people, real estate is an expensive investment. So one should make the most of it. A multifamily home’s live-in, rent-out setup makes this possible. You can rent out the other units while retaining one as your personal living space. Owners enjoy a steady cash flow from tenants.
- Higher income
It’s cheaper at a cost-per-door basis compared to other properties. This is important for investors who want to maximize the rent they’re getting from their property. A $70,000 single family home can fetch a monthly net income of $700 for its owner. This is a lot smaller than a multifamily home of the same value in the same neighborhood that can earn a net monthly income of $500 per door.
- Lower maintenance costs
Since all units are located in one location, repairs, big or small, can be done in one go. This saves the owner time, effort, and cost. This isn’t possible for multiple single family homes located in several different locations with distinct maintenance needs.
- Maximum use of space
Income comes from occupied units, not from the land on which the property stands. By maximizing space, investors minimize loss of income from unutilized land.
It would be wise to take advantage of strong market demand for multifamily homes by investing in one.
More and more young adults and seniors are looking for a place to live in at minimal cost. And a unit in a multifamily home is a good option for them.
They enjoy a space of their own without worrying about maintenance issues. And the price is a lot friendlier as well.