First Investment - Single or Multi Family Home?

[Raymond Y.]

I have $50k to invest with and I am looking into the Lehigh Valley/Allentown area. Looks like I can pick up single family homes for $50k or duplexes for $100k. I am comfortable with leveraging myself, but at the same time, paying all cash seems to make the closing process a lot easier. For a complete beginner who cares about getting higher returns, in my situation is there a clear winner for SFH vs MFH?

[Brian H.]

If you spend a lot of time on here reading  in the forums and also sometime listening to some of the podcast I feel like you'll hear time and again that people highly recommend  multifamily  over single family . 

Granted,  there are those that prefer the single-family over the multifamily and they have their arguments and reasons. 

The logic of multifamily over single family makes a lot more sense to me personally. You have one property to visit with multiple tenants on that one property. One property tax to pay. One Insurance bill for that one property. Multiple rims coming in for that one property. You could always house hack if you have a multi-family. One of the big reasons that makes a lot of sense to me is that if you have a single family and you're using that rent to pay that mortgage and then that house is sitting empty, how is that mortgage getting paid? If you have a Triplex, for example, and one of the three units is empty well then you at least have the other two units helping pay the mortgage and other bills associated with the property.

I don't actually own any rental property myself yet and just closed on my first flip property today. But these are all things that I've heard that made a lot of sense to me personally. In the end you should do a lot more reading on here and kind of think about what makes the most sense for you.

I would definitely Leverage. You can get a lot more property for the buck by leveraging. That could be the difference between a single-family home with one rent coming in or Triplex with three rounds coming in. But, you do have those on here that argue that it's better to just do all cash and never owe anyone any money. So, again, it comes down to what you're most comfortable with and what you think is best for your situation.