I have both multi-units and single family homes in my real estate portfolio. Both can be very profitable, but there is a distinct difference in the two.
While Multi-units have a greater potential for cash flow, they can also cost more. Tenant seem to be more transient in the apartment like units. With a higher turn over, comes more cost. Each time a tenant moves out, there are certain repairs that need to be done and vacancy days with no cash flow. Some investors do not mind this because of their ability to generate more income.
Residential homes seem to attract a more stable tenant. Families gravitate to these homes, and once the kids are in school, the families like to stay put. In most cases, the cash flow is solid, repairs are minimal, and they rent fairly quick.
The other difference is sales. The market of potential buyers is much larger for residential homes, than for multiplexes. This makes residential homes much more liquid for the investor.
Lease options or land contracts are also mush easier to acquire for residential homes vs. multiplex properties. (Lease optioning or land contracts tend to get more money down and a higher monthly payment.)
So when your are considering each type of property, keep in mind their differences. Make sure they fit your portfolio and exit plans.
Everyone is different, so plan your future according to your needs. Enjoy the process.
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Brett young
Valley Realty
Owner/ CEO Roof Top Investment
Real Estate Investment
http://www.rooftopprofitmax.com/
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