The good investment starts with a purchase of land or property in a low valued area. And when you are dealing with a multifamily property, you will not have to pay much for the walls, roofs and other areas of the property. In general the square-foot cost of a multifamily building is quite lower as compared to that of single family homes. Below mentioned are a few advantages that you will get with multifamily buildings.
Management and Security Costs
The cost of security and building management always takes a big chunk of the income that you earn from the property. If you are an owner of multifamily building, you will be able to avoid spending too much of the money in these areas. Moreover, you may not like the idea of traveling to your multiple single family homes no matter how close they are to your location. You will always have some difficulty in managing different single family homes as compared to managing one building with several units.
Costs for Maintenance, Repairs, and Upkeep
Although there is a bit of advantage with the single family homes that you can leave most of the maintenance tasks for the tenants, you are still going to get calls for maintenance; and you are going to have to fulfill those request. In comparison, there may be a bit more maintenance tasks that would come under your responsibility while renting out an apartment unit but you will have quite an ease dealing with those issues. Maintenance companies work in better way when they have one location to serve.
Saving costs on finishes and fixtures
When you have different single family homes, there are going to be different layout of every property. It means that the finishes and fixtures that work for one property may not work for the other. In this scenario, multifamily apartment provides you an ease along with the cost advantage. You will not have to buy different types of fixtures from different vendors. Instead, you can contact one vendor and ask for the fixtures in bulk.That will surely help you save the costs. Moreover, you will be able to save much while doing the finishing of the building because you will go with one design.
Although this is not always the case, multifamily properties tend to provide you greater tax benefit as compared to single family homes. For instance, you will be able to build more rooms on a piece of land. Generally, a multifamily apartment can be built on the land of the size which may not be enough for two single family homes.