When it comes to real estate opportunities, investing in a multifamily home can be one of the best ways to ensure continued growth. Not only can you be assured of a steady income, it is also much easier to get the financing that you need to get a multifamily project off the ground.
If you meet the requirements, it is easy to visit a United States Department of Housing and Urban Development (HUD) multifamily lender to get a fair loan. While it is true that the initial cost of acquiring an apartment building is higher than that of acquiring a single family home, it does have a higher pay off over time.
Other than having a more constant cash flow, multifamily homes are much easier to manage. Instead of handling individual properties spread out across the city, you only have to worry about one building. You can have a significantly smaller staff on site: You only need one management company to handle all the rent collection and any maintenance dues required.
When a building’s value goes up, this is called “appreciation.” Most buildings do not appreciate in value as time passes. On the contrary, their value often goes down as time passes, and as they require more intensive repairs.
Most homes depreciate in value over time. While the same happens to apartment buildings, it is much easier to raise their value, simply by adding more amenities. With a single family home, restorations and repairs will increase the appreciation of just one property, but with a multifamily home, you can do so all at once for multiple apartments.
Multifamily properties can get great tax breaks as you would be helping your city provide safe, affordable housing to its residents. The FHA provides tax incentives in the hope that more developers build apartment complexes.
Indeed, multifamily homes are a sound investment for developers.