Should my first MF be a 2fam or 3fam

Question

I’m looking to purchase my first MF property and have been advised of so many different things that I’m completely lost at this point. I want to know the pros and cons of the amount of units I should strive for and what makes the most sense investment wise.

Bjorn Ahlblad · Answer

@Kodi Parker I would not give the 2 or 3 unit-which is better-anymore thought. Instead look for deals that are going to be profitable and meet your investment criteria. All things being equal I would go with more doors; but things are never that equal so go with the better deal-better neighborhood, better tenants, better building. Be sure and get an inspection done by a licensed pro, and do your due diligence on the financials. All the best!

Frank Geiger · Answer

Typically, the more units the better. For example,

If 1/4 units are vacant, that means 75% of tenants are paying rent. If your criteria is $200 per unit cash flow a month, that's $800.

If 1/3 units are vacant, that means 66% of tenants are paying rent. If your criteria is $200 per unit cash flow a month, that's $600.

Both are great options. Just because it has more units doesn't make it a better deal. You need to look at it holistically. Spend time educating yourself on all the material provided by this site. It will save you money in the long run.

Jill F. · Answer

Whatever you can find the best deal on.

Theresa Harris · Answer

There is more than one way to do it.  Find numbers that work for you and go for it.

Kodi Parker · Answer

@Bjorn Ahlblad thank you so much I really been stumped

Kodi Parker · Answer

@Jill F. Thank you

Kodi Parker · Answer

@Frank Geiger thank you I will look further into educating myself on calculations to see what makes sense

Should my first MF be a 2fam or 3fam

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