Multi-family housing! Why? The lifetime value of ongoing cash from rents is likely to be much larger than the one-time profit involved in “flipping” houses (buying low, fixing up and selling higher).
There is less anxiety about getting a price that justifies all of the work that went into acquisition, repair and sale of the property, and the tax treatment of ongoing rents may be more favorable than that of a capital gain from the sale of a single property. Investing in multi-family housing may be one of the best Real Estate investments that yield the best ROI (rate of investment).
What does the rental market look like? According to statistics taken from the U.S. Department of Housing, new housing is not keeping up with the growth in population. There were fewer than one million new housing units added last year, housing production was almost a third below the average of the last thirty years.
Studies by New York University’s Furman Center have shown that rents are up in urban areas across the country, a trend that has been consistent across all kinds of neighborhoods. Low income renters, affluent renters and everybody in between have been affected by the increase in rental pricing.
For those who invest in apartment buildings, these statistics support the theory that multi-family housing investing is, and will most likely continue to be a great deal.
As the population growth outstrips housing growth, rental properties will continue to be in high demand, which means rents are in little danger of collapsing. But, for my newbies and potential investors who have never before invested in multi-family housing, it would be prudent to work with a professional who is familiar with the market, as these transactions can be with different than those involving the single family or small multi-family dwelling.
Always follow the golden rule of real estate which is location is always key. Look for neighborhoods with high growth potential. Line up your finances; talk to a mortgage professional, preferably someone who is familiar with multi-family financing and enlist the help of a real estate agent that can help you navigate and walk you through the process.
Sharon R. Frank Realtor – Motivational Speaker Sharonrfrank.com Email firstname.lastname@example.org Linkedin.com/in/sharonrfrank Facebook.com/sharonrfrank Instagram.com/sharonfrank