The one question you should answer when deciding whether to invest in multi-family properties is do you want to work for your money or have your money work for you?
Investing in single-family properties has helped many investors build wealth but only if you have great tenants, your tenants rarely moved out and they pay the rent on time every single month. If any of these things don’t happen you are now scrambling to the courthouse to begin the eviction process, running ads to get someone in there as soon as possible and trying to hire contractors to undoubtedly fix whatever damage has been done to the property. There is no backup tenant to run and jump into the now empty property. The money that you might have made has gone from income to expense and your profit to a loss.
The biggest advantage to multifamily investing is that the risk of loss is minimal. The chances of your property being 100% or even 30% vacant is rare. Of course, location and the condition of your property has a lot to do with vacancy rates, but this is where your money is put to work for you. With proper budgeting, you can easily manage the repairs, upkeep and general maintenance of the grounds. Vacancy issues can easily be handled by running ads on a continuous basis and even set up a waiting list for future prospective tenants.
The next advantage to multifamily investing is lending options. This will be considered a business or commercial loan. It is mainly based on the income possibilities of the property and not solely based on your portfolio or even your credit alone. Also, believe it or not pretty much anyone with the initial funds can get into multifamily investing.
Mutli-family properties produce better cash flow, are easier to finance, offer excellent tax breaks and help investors diversify their portfolio especially if the investors work with a qualified investment real estate advisor to find the best multi family properties for sale.