Single or multfamily - first timer?

Question

Hi folks,

I'd love to hear the perspectives of some experienced members on this question.  I've read pros and cons on each.   Which did you do first - and if you had it to do over again, would you do the same thing?

Thanks!

N/A N/A · Answer

Go multifamily. They're a more typical style of rental, so you'll have a larger pool of prospective renters; also, each tenant will be tying up a smaller percentage of your holdings (2 tenants in a duplex, vs. 1 tenant in a single family).

My first property was a duplex, which I was able to purchase as my primary residence and live in half of, while renting out the other half. While not for everyone, this allowed me to get much better financing, as well as breaks on insurance and taxes.

Derek Guyer · Answer

I mostly work with multi-family properties myself, but have seen investors on both sides of this be successful. A lot of your decision to choose one or the other depends on your goals, your resources, your time, and your work ethic. I would take the time to visit your local REI club and try to talk with some experienced guys. You'll hear lots of different ideas and thoughts, but most of all you learn what makes sense to you.

REI isn't an exact science. Certain things work in certain cities and then completely fail in others at one time and then succeed at another time. So, learn as much as you can and don't be afraid to jump in when you think you're ready. As long as you have a good team around you, you'll be fine!

Oh yeah, I have single families now and they're working fine for me. I do very little on them and they make a nice return. I look forward to getting into multi-families in the next couple of months as I'm locating good deals.

Matt H · Answer

Get serious, multi family. It's a no brainer. Mainly because if a house goes vacant you pay the mortgage until it's filled. With a rooming house, or an apartment, or anything multi unit, you can calculate what % of the building would have to go vacant before you'd have a negative cash flow. That way you have far less to worry about. The cost per unit is cheaper and the economics make far more sense.

N/A N/A · Answer

What kind of investing are you planning on doing? Fix and flip? Own and rent out?

Houses are usually easier to turn over if you are just looking to flip.

I like multi-family better to own and operate. One reason is that when you have a vacancy in an apartment, you only lose a percentage of your income, whereas in a SFH if your tenant moves, it's all gone.

N/A N/A · Answer

Can you go into a little more detail?  What cause your mulit to be a problem?  etc...

Joshua Dorkin · Answer

I started with multi-family properties, but if I could do it again, I'd have gone with a SFR.  It is just a bit easier to handle IMO.  Other thoughts?