Single Family vs Multi Family vs Apartments for Cashflow

[Tyler D.]

I am a new investor and am looking to get into Real Estate as a way to grow my savings. I currently have $200k that I can use to invest.

I have looked into SFH and MFH, and both have their pros and cons. I haven't looked into apartments, but I have heard that they can have a great ROI. I'm a little hesitant to even look though, because of my lack of experience.

Ultimately, I want the option with the best long-term cashflow. I am willing to put in the work at the beginning to make it mostly passive after the first few years of setup. Should I look into apartments? Stick to SFH or MFH? Let me know your thoughts.

[Alina Trigub]

@Tyler D.

The decision on the strategy is in your hands. However to give you my perspective, when I was deciding whether to take SFH vs MFH route, I realized that the economy of scale plays a huge factor for me. Let me explain. Let's say you're buying 5 doors (5 SFH vs 5 unit building). Do you prefer to have 5 closings or one, do you want to replace 5 roofs or one larger one, do you want to pay your attorney five times for closing or pay one fee, last but not least: when each of your SFH is empty, you have 100% vacancy; when one of five units is vacant, you only have 20% vacancy. This logic helped me make a decision.

Here's another post describing why I chose MFH:

https://www.biggerpockets.com/member-blogs/10850/74895-five-reasons-why-i-chose-to-invest-in-multifamily