Owning multi-family homes comes with its own individual challenges as well as benefits.
While you have to deal with multiple flats and any problems that pop up, you also have all your work consolidated into one area. If you live in the same building, you’re also managing the people you live with and hand-selecting your ideal occupants.
But are you taking full advantage of your situation and aware of all your responsibilities? Here are some things you should know about owning multi-occupancy homes.
What is a Multi-Family Home?
A multi-family home is any building that contains multiple residences or commercial spaces with shared amenities. Some examples are apartment blocks with different flats; all rented out separately but inside the same structure.
Duplexes also count as multi-family homes, even though they only boast two residences in the same building.
Financial Demands of Multi-Family Homes
Investing in a multi-family home takes a more significant amount of money than other properties due to their size. It’s not easy to find a lender who can help mortgage it, so consider yourself lucky if you have.
In addition, multi-family homes have ongoing financial demands such as maintenance, hiring a doorman, and renovations. Even if all seems well, it only takes a burst pipe for you to suddenly need to replace a wall and update your water lines.
One way to deal with these financial obligations is to charge extra for certain amenities. These can include parking space, pool access, or a pet fee. There are also various tax benefits to owning a large investment property.
Despite the cost of purchasing and maintaining a property, you could stand to make a lot of money with multi-family homes.
Millennials are your key demographic in bigger cities. Statistics show that they’re also not ready to purchase a house, and they’re always on the lookout for an affordable living space.
When it comes to building your portfolio, an apartment block helps fill it out with a single purchase. A single building can contain as many as 20 apartments, which is a much easier acquisition than buying the same amount of houses.
Hiring a property manager is an expected practice when you own multiple properties. With multi-family homes, you won’t need one. Since everything is in one building, you can knock out multiple visits in one go.
It all depends on how many buildings you own and how much personal time you devote to them.
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Making the Most of Your Investment
Real estate investors who already own multi-family homes already know how expensive they can be to invest in.
The financial benefits and passive income make it more than worthwhile, though. And if you live inside or near one, maintaining it won’t take much effort or persuading.
Read More: Why you should be improving your home