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Updated over 10 years ago on . Most recent reply
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Commercial vs. Multifamily buy and hold. Which would you purchase or avoid and why?
I placed this question in Off-Topic seeing that it's mostly hypothetical. I'm a SFH buy and hold investor and would like to step it up a bit.
To add more detail to my question. With my understanding being that a commercial property is when a building has five units or more. Using the multifamily is a 4 unit and commercial is a 5 unit scenario - which would you purchase or avoid and why if the numbers came up to the exact same amount per unit in cost and value with the exact same potential rental amount per unit and you can afford either (of course the commercial numbers are up by one unit in costs and returns)?
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@Timothy Riley - I have looked at both. The issue for me with 5+ units is (in Chicago and Milwaukee) city services that are included in your taxes for under 4 units are not in over 5 units. So when I have looked at 5+ unit properties the expenses were almost double per unit so it really ate into your cash flow. Once you get to 30+ units it really is not a big deal. But I am not at that point yet.
- Brie Schmidt
- Podcast Guest on Show #132
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