Single Family vs. Multi-Family for next investment

[Nancy C.]

I own a three family in Boston that's doing well and I have transitioned it to a property manager while I am in Australia for 2-4 years. I want to invest in the US again to take advantage of the low interest rates, cash flow and better returns than in Australia.

The normal progression for an investor is SF to MF, but I have been connecting with other local investors that have multiple SF's in the US.

Do I buy a couple of cheaper SF's, or another multi? Right now I'm considering the Denver area (because I have family there) and 3 specific Dallas suburbs (because another investor has great contacts that I can leverage, but his experience is in SF's).

I'm doing the analysis at the moment to see which area seems better, but that analysis is skewed if I look at SF's vs. MF's. Or am I making this too difficult? This is probably too broad of a question to throw out there, but I have been running around in circles the past few days and thought I would ask for some advice or guidance.

Ideally, my goal is financial freedom in 5 years, I have about $75K to invest, and am about 1/8 of the way to financial freedom right now.

[Ned Carey]

You should look at which will bring you better returns and which will meet your financial objectives better.

If I could financially swing large multi units, I would because they are more truly passive income. You can get a much higher level of management with a large number of units, managers with ARM or CPM credentials.

In my area (Baltimore) multi family properties do not bring near as large a return as SFH rentals. We are talking 7 or 8% cap. rates vs. 12 to 20% for SFH. So currently I am going with SFH. You will probably find that is what is working in most markets.

I am a big believer in take what the market gives you. I have moved from wholesaling to Buy and hold SFHs, because that is where the easy money is.

Do you know where you will be living when you return to the US? You might strongly consider that market. Given that market, what is working there?

Good luck - Ned