Single-family residential real estate investment is great. It can represent a phenomenal entry point into owning real property. Single-family residential real estate investments can secure you rental income, depreciation, and equity. After all, it teaches you how to find a property, identify its value, and turn it into income through rent or sale. Although, what we have discovered is that single-family residential real estate investments are often the jumping off point for our most successful commercial property investors.
Why Should You Make the Move?
Many single-family property investors have the goal of buying cheap, renovating, and making a profit by selling above the amount that equates to your sweat equity and expenses. It can be a grueling cycle where every deal has the potential for unexpected surprises that can negate your profit or create a loss. At some point, many single-family property investors get tired of being on the treadmill of finding, buying, repairing and selling. They want a continuous stream of income based on a process of finding and buying only once but obtaining multiple revenue streams.
Even if your residential property investment strategy is to eventually lease the property out, to grow the income you must have acquired multiple properties around the city, each having their own concerns and issues.
The work to manage multiple properties that are scattered around the city can be expensive and time consuming. Just when you get done repairing the roof on property A, the plumbing in property B starts leaking. The next year, it is reversed. What if those residential tenants shared the same building? Easier, right? One crew, one location, one time, and it’s done.
All the economic and social factors indicate that the multi-family dwellings will continue to be a sought after and secure investment. Millennials are not buying homes at the same rate their parents have done. A report by the Urban Institute shows that home ownership for millennials is eight percent lower than the previous two generations for the same age groups. The reasons are obvious. Millennials are choosing apartments due to high cost of student loans, location preferences, marrying later and the cost and obligations of single-family units.
On the other end of the spectrum, Baby-Boomers are also choosing to move from single family residential properties. Millions of Baby-Boomers are finding that retirement is easier when they do not have the costs and the work associated with owning a house. They are seeking life in apartments to make their golden years better.
Investors who traditionally favored the stock market are also turning to commercial real estate investment due to the volatility that the stock market has been experiencing. With a potential recession looming for 2019, there is not a better time to switch from a single family property to a multi-family property investment. It will diminish the risk if one family is late on a payment or if a property is vacant.
How do You Make the Move?
Investing in commercial real estate is hard, right? You must learn how to find and qualify properties, then figure out how to get financing, and deal with multiple tenants.
It's like anything else, if you haven’t done it before it can be difficult and confusing. What you need is a coach to teach you the ropes and identify how to find and qualify the right properties, then give you the tools and forms that will protect you and maximize your profits.
Armed with this support and materials, the whole process becomes easier.
Commercial Academy has helped thousands of single-family property investors find financial success in the multi-family arena. We provide proprietary training, materials, and tools that allow you to gain the confidence and knowledge to invest in this growing sector.
If you have been focused on single-family property investments, you owe it to yourself to learn if investments in a multi-family property is right for you. A free consultation with one of our investment coaches will help you decide.