5 Reasons Why Multi-Family Investing Is a Very Smart Choice

I get asked all the time if they should REALLY invest in multifamily properties. Of course, my immediate answer is “absolutely!” I do not say absolutely because I actively play in the niche. I say so, because there is no reason that multifamily isn’t right for almost everyone. Okay, it is a given fact that we are all playing with different investor identities. However, multifamily investing mitigates almost majority of investment risks, making it an absolute choice for anyone who seeks to grow wealth.

Multifamily property investments are obviously today’s most powerful strategy to get your money growing. This is the only type of investment that can provide a consistent cashflow month after month. But that reason alone is only the most common you may have heard many investment gurus talk about.

Here are 5 more proof multifamily investing is a smart choice:

1. Makes Property Management Easy

Imagine owning 12 single-family homes across the city and manage them.

Long drives, impossible schedules and lengthy list of things to do are probably your perennial dilemma. Now, imagine just managing 12 homes under one roof? That means you can easily assign the property to an efficient property management of your choice. No driving, site visits, etc. freeing your time for things that matter most to you.

2. Easier Property Appreciation

Appreciation is difficult and often rare. Why?

You need to do specific renovations, improve amenities that can be a great benefit to the “tenants.” This is the only way appreciation may happen. With single-family homes, your options are very much limited, it’s hard to push for property appreciation.

In single-family homes, you can repaint and renovate the entire infrastructure to force appreciation, however, remember that whatever functionality or aesthetics you improve, you are only doing it to one home.

Now imagine doing that to an apartment building or a multifamily property, everything you fix and improve, you are forcing appreciation exponentially. This is definitely one of the strongest investment points of a multifamily property versus single-family rentals.

3. Multifamily Is Open for Other Cash Possibilities

Beyond rent, you can make a month to month income by improving to business infrastructure added to the homes. For example, adding a laundry room with decent coin-operated machines will definitely get you extra cash opportunities.

But that’s not all. Addition of one-bedroom units or studio units dedicated for transient tenants will also give you additional income.

4. Tax Incentives / Tax Breaks

Going into a business that provides housing is being in service to the people. The government think so too!

The government likes the idea of producing homes for the people. A clean, safe and affordable housing is definitely a great help. Because of this, you can gain tax incentives. You can take a whole bunch of deductions because this is a business.

You can depreciate many things in a multifamily property or any rental property which can take in effect for more than two decades. The size of the properly and some other factors come into play for the classification of your incentives.

When you are in a multifamily investment it is crucial to get a very competent CPA or a CFO to help you get as many deductions. Do you know that you can even get government grants that offsets upfront costs? The benefits of this one is huge and you can end up paying minimal taxes!

5. Multifamily Properties Retain Value

The biggest player to multifamily properties is how it attracts tenants. If your property is averaging 70% to 90% occupancy rate it means it can generate massive income. If you keep the property rehabbed to attract tenants, it will definitely also attract investors.

If ever you want to sell in the future you can even gain profit for all the maintenance and work you have put in. A well-managed and constantly improving multifamily properties are ALWAYS HOT in the market.