Becoming a real estate investor is a serious decision. While real estate investing can be a rewarding experience and provide additional income, it can be disastrous if you are unprepared and move forward without a skilled team on your side. Investing in multi-family properties comes with its set of challenges. Learn how to navigate the waters with these helpful tips.
Narrow Down Your Interests
Multi-family homes include condominiums, apartment buildings, and duplexes. What grabs your interest when you think about investing in these properties? Do you plan to live in one of the units and rent out the rest? Maybe you would rather use the entire property for rental income.
Do you have your sights set on a small set of duplex apartments? Are you aiming for a condominium community with fifty units? Knowing whether you want to invest in a small or larger property is an important distinction that impacts things like financing and insurances.
The size of the building influences certain financial aspects. A smaller multi-family property is residential real estate. The lender considers a small multi-family home in much the same way a single-family home is when it comes to securing a loan. A larger multi-family property is considered a commercial investment. Appraisers use different variables to determine the value of various size properties.
Can you afford to purchase a multi-family property for investment purposes? While the income you can generate from these rental units may sound alluring, it’s best if you’re standing on a stable financial platform from the beginning. Loans for smaller multi-family properties are secured much like single-family homes. You will need a down payment to move forward. Larger multi-family properties may take more money upfront to get financed.
Gather Your Support Team
Navigating the waters of investing in multi-family properties can be tricky without a good support team to back you up along the way. Find a professional real estate agent with the experience and knowledge you need to feel secure in your transactions. Make sure they deal with the type of multi-family property that you plan to purchase. Having a reliable attorney for consultations is wise when you consider the different rules that may arise with buying larger multi-family properties.
When you use your investment properties as rental units, you’ll run into times when you need certain professional services. Find a trustworthy construction company, pest control company, electrician, and plumber to handle general upkeep and emergency fixes.
Do you want to take care of the management of the properties yourself? If not, you will want to find a trustworthy property management company to deal with the daily tasks associated with rental properties. Many property management companies handle maintenance issues. Other companies simply collect the rent and keep an eye on things. Know which one works best for your needs before you begin the search.
Your real estate agent is the best source of information about the local community and real estate topics. Give Rachael Hughel a call today at 818-397-8177 to learn more about local areas, discuss selling a house, or tour available homes for sale.