There are always people looking for a new place to live. Whether people are striking out on their own for the first time or downsizing to make life simpler, multi-family housing can potentially reach many people.
Branching into a multi-family housing complex can be an exciting opportunity. If you can attract the right people in sufficient numbers, you could experience a significant return on your investment.
Here’s what you should consider as you think about your next real estate investment.
The old real estate mantra rings true in multi-family housing, just like in other areas, “location, location, location.” Your search should include both available properties and an analysis of people seeking multi-family housing in that area.
Consider also what you are willing to invest before the property could command higher rents. Depending on your market, you may be better off starting from scratch than forcing a property to be the right fit.
Determining your market
When you are analyzing demand, look at holes in the present market for that area. Consider what it would take to attract your target market in the area of your housing complex.
Your future tenants will be interested in what your property has to offer compared to those nearby and in a similar price range. Pay attention to what other properties are offering and what you can make your housing complex stand out.
What is your timeline?
The whole idea behind investing is getting a return on that investment. Consider how much you can invest and how soon you need to start seeing a return.
A property that is liveable or close to move-in ready for your tenants will be prepared for a faster return that needs some fixing up. Consider whether portions of the property can remain rented while you undertake renovations.
An experienced commercial real estate attorney can help you evaluate your needs and goals, as well as review contracts and other paperwork. Having the right support can make a complex real estate transaction simpler to navigate.