When people start looking into real estate and investing in properties, one question usually comes up. This question relates to whether or not investors should look into multifamily properties. While any investment decisions should be considered in light of current financial situations and needs, generally investing in a multifamily property is usually a good idea.
Here are some of the top reason why that is:
1. There Is Cashflow in a Multifamily Property
Most real estate investments are looking for cash flow as opposed to just purchasing and holding. While obtaining rent from multiple tenants in a single building is a great way to generate income, there are actually some other ways to do this as well. A multifamily property allows for multiple revenue streams above and beyond just renting.
For instance, you could add a laundry facility to the property in order to maximize your revenue there. This helps the tenants because they don’t have to go far in order to get their laundry done and the equipment will become a revenue driver over time.
If you do something like this, just make sure that the space is clean and safe. You might consider adding some security features like cameras and alarms. Increasing the quality of life for tenants while also generating income is a win-win.
2. It’s Easier To Manage Multiple Properties In a Single Place
When people invest in real estate, they may try to diversify their holdings and get properties in lots of locations. While this can be a sound strategy, the management of each property becomes even harder. When you have multiple tenants all located in a single place, you can be much more efficient and fix many different problems with each visit from a property manager.
The bigger your multifamily property, the better the returns are here. You can get so much more done with much less. Either way, you’ll want to make sure you have a good property management company helping you, but this can make it a lot easier.
3. Your Value Should Hold
Another great benefit to multifamily properties is that they hold their value really well. As long as you’ve made the necessary renovations over the years and kept it well maintained, it will be easier to get tenants to fill vacancies and hold its value if you ever decide to sell to another investor.
Take the time to keep your property in shape and you should have a great long-term investment!