5 Ways Multifamily Investing is Better Than Single Family 

When investing in real estate, it can always be a bit of a risky business depending on the rise and fall of the housing market. However, some kinds of property investments are more stable than others. Investing in multifamily units are generally better than single family units for a number of reasons.  

Economy of scale is one reason why you may want to go with commercial investments instead of residential. Where single-family units have to be maintained individually, causing more work and therefore more labor costs, an apartment building or similar building with more than one family allows you to get business from multiple sources while having less building work overall to do. Your per-unit expenses will be lower since, effectively, the cost of maintenance such as roofing and driveways and landscaping can be spread out over all of the units instead of just one family.  

Buying one property that houses many families is also a lot easier than buying multiple properties that only house one family each. Multifamily units therefore allow you to build a larger customer base with only one investment instead of several. This causes significantly less legwork, as you are only visiting one property and only talking to one seller to make the deal. It can also be a lot quicker than buying up individual residences.  

In addition to expenses, risk is also spread out over more units. If you have a unit with 10 families and someone vacates their apartment, you still have income coming in from the other 9 families to help pay the mortgage and utilities. However, with a single-family home, if the family moves you are stuck with the entire cost until you can get a new family in. That means that you are less likely to have to give up the business if you have multiple families under one roof.  

Due to the difference in how value is determined between single family and multiple family units, you have more control in the appreciation of the larger property. This can help you with making profits if you choose to sell.  

Lastly, there is a lot less competition in multifamily homes than there is in single homes. Many investors choose to spend their time and resources finding single-family homes to purchase and flip. This oversaturated market of house flipping can drive the prices down, where commercial properties remain relatively untouched. If you want to get into the real estate investment business, consider looking at multiple family units.  

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