With the global recession and economic uncertainty, investors are running out of options for safe, high-yielding investments. Stock market volatility is not only common, it is the norm.
Many investors rule out multifamily investments as unaffordable, unattractive, and non-feasible or accompanied by high maintenance costs. This is a costly mistake.
Multifamily investments (particularly investment in apartments) offer stable returns, accompanied by consistent appreciation due to increasing rental rates over time. Such investments are tax-advantageous and can easily be financed through a low-interest bank loan and/or a retirement account. Here are a few reasons why multifamily investments should NOT be ruled out:
1. Reliable Source of Income
A vacant, single-family unit means zero income. In contrast, an apartment complex is never fully vacant. Tenancy is always available and such multifamily dwellings are never unoccupied, even during the highest turnover seasons. As more and more immigrants move to the United States, the demand for multifamily apartments is ever increasing. Increase in demand is accompanied by an increase in tenancy and a corresponding increase in rent per unit. This serves as a stable source of income for the investor.
2. Ever Increasing Demand
A large number of tenants are now seeking multifamily homes, rather than single family dwellings. The National Multifamily Housing Council reveals that over 60% of the rental properties across the United States represent multifamily apartments. This means that tenancy is always available and returns can be expected to grow with the monthly/annual rentals, making multifamily investments more profitable than ever.
3. It’s Cheaper
Initial investment in a multifamily property may appear to be too high, but that is not the real picture. Investment in a single-family unit is restricted to that particular unit, whereas, investment in a multifamily apartment is spread evenly over a number of dwellings. This makes the cost per unit significantly lower. Furthermore, it also increases your revenue earned per unit.
4. Easy Financing
You can easily investment your IRA in to buying a multifamily property. There are no legal restrictions and stipulations attached. Applying for a bank loan or any other form of lending is also easier, as most banks realize the high-yielding potentials of multifamily investments. To learn more on how to apply for a multifamily property and evaluate all your lending and asset management options, click here.
5. More Options to Choose From
Unlike traditional real estate and stock businesses, multifamily properties have certain “hot spots”. These are cities, areas and localities where the multifamily properties are in high demand and offer high returns. Examples include San Diego, San Francisco and Los Angeles. Similarly, certain cities in Texas, Colorado, Wisconsin and Alabama offer lucrative multifamily investment opportunities too. When it comes to multifamily investments, you have over 100 cities to choose from, as opposed to stock market where high-priced shares of only a few big companies are profitable.
6. Best Services Can be Availed
A multifamily asset manager is not your average stock broker. They manage your investments in multifamily assets with due diligence, as opposed to trading for the sake of trading or investing your dollars into riskier stocks. This makes multifamily asset managers reliable and your multifamily investments as profitable as ever, without any undue exposure to speculative business risks.
Click here to learn about how one of the leading multifamily asset management businesses in San Francisco helps its clients in managing their multifamily investments.