Rental Property Types How Can You Find the Best Multi Family Homes for Sale to Invest in? by Yoana Leusin July 8, 2018August 13, 2018 by Yoana Leusin July 8, 2018August 13, 2018 When it comes to investing in rental properties, there are two main types of property to choose from. These are, namely, multi family properties and single family homes. However, many real estate investors desire to finance multi family homes for sale. Well, they are quite right for several different factors. Let’s just mention that investing in multi family homes is in the section of a low risk investment strategy with typically a great return on investment. Besides generating a fantastic rental income, multi family properties are a real treasure in the portfolio of every house investor. Oh, you also want to know how to find the best multi family homes for sale? Don’t worry, we will reveal the secret in just a moment. #1 Multi Family Properties Such investment properties consist of multiple housing units. Thus, when investing in multi family homes, the investor can be buying the whole property or one/several units in it. Due to the fact that such investment properties consist of multiple units, they are categorized as low risk. This is simply because if one of the units is empty, the income generated by the property will not decrease as significantly as it would with single family homes, for instance. Additionally, the high return on investment of such properties might be explained through the fact that one upgrade in the common area of a multi family home brings up the value of each and every housing unit in the building. Curious to learn more about multi family properties? Make sure to read “How Can I Find the Best Multi Family Homes for Sale in 2018?” #2 Multi Family Homes for Sale: The Two Types of Property Aren’t multi family homes for sale already a specific type of property? Well, yeah, technically they are. However, multi family homes for sale can also be subdivided into two other categories of rental properties. When buying a multi family home, it is of crucial importance to know this as it might influence your whole investment strategy and planning. So, what are the two types of multi family homes for sale? Residential Real Estate Investments This implies that after buying an investment property, it will be leased to tenants providing them with long term accommodation. In other words, we are talking about housing units, such as apartments, condos, etc. Specifically, multi family homes that have 4 units or less are considered residential real estate investments. Interested to learn more about residential real estate investments? Make sure to read “Residential Real Estate Investing: The Best Way to Make Money in Real Estate.” Commercial Real Estate Investments The other type of multi family homes for sale is related to commercial real estate investing. Typically, the tenants of commercial real estate investments are companies and business organizations. The properties might be office spaces, shops in malls and so on and so forth. However, in the case of multi family homes for sale, the investment property is considered a commercial real estate investment if it has 5 housing units or more. Curious to learn if commercial real estate investing is better or worse than residential? Then make sure to read “Commercial Real Estate Investing: Better or Worse Than Residential Real Estate Investing?” After you have considered which type of multi family homes for sale is your future investment strategy, you need to consider the steps towards finding and buying the best multi family home. #3 Multi Family Homes for Sale: The Location When investing in either type of multi family homes for sale, you should carefully choose the location in order to ensure the success of your property. Of course, real estate market analysis is a must when buying an investment property. Comparative market analysis, as they also call it, can indicate the profitability and performance rates in the market as well as forecast the future trends. Additionally, such an analysis can help you in answering the question: “How much can I charge for rent?” However, conducting comparative market analysis is simply not enough. There are a few points the real estate investor should keep in mind when buying a multi family home. First of all, the local housing market should be economically stable. Moreover, the area of the investment should have connections to public transportation and the necessary facilities. Additionally, population growth and growth of job opportunities can only be beneficial to your business. Last but not least, make sure the competition in the area/neighborhood is not high. When investing in commercial multi family homes for sale, our tip is to also keep in mind the four different property classes before putting your money in the investment. #4 Multi Family Homes for Sale: The Property Needless to say, choosing the property itself is one of the most important tasks when purchasing any type of property, including multi family homes for sale. Of course, every real estate investor wishes to invest in a property with the potential for development. Performing investment property analysis can be of great help in this case. Such analysis reveals all the real estate metrics you need. On the basis of the numbers, you can decide if the chosen property will be an asset or a burden to your investment portfolio. Conducting investment property analysis and real estate market analysis is a challenging task, especially when researching various properties. For this very reason, we suggest you use a rental property calculator to help you in the job. Mashvisor’s rental property calculator is one of the best tools in the market and can guide you through the process of finding the best multi family homes for sale with no effort. What’s more, Mashvisor allows you to look for multi family homes in many of the major US cities. Just check our website and start your 14-day free trial with Mashvisor and subscribe to our services with a 20% discount after by clicking here. Start Your Investment Property Search! START FREE TRIAL Start Your Investment Property Search! START FREE TRIAL 0 FacebookTwitterGoogle +PinterestLinkedin Yoana Leusin Yoana is an experienced content writer with a BA in leisure studies who enjoys giving tips to beginner real estate investors. Previous Post Investing in the Houston Real Estate Market in 2018: Yes or No? 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