I am a noob to the real estate world, and have been consuming as much information as possible in the last few months. Upon much consideration, my fiancé and I have decided to make our first home purchase a multi family property here in Austin,TX. We will be buying in 2016, but I was wondering if there is a better time of year to buy multifamily? Is there more inventory during the spring and summer vs winter? Are prices cheaper in the winter? I know for SF homes there are specified "seasons" for buying, does this apply to multifamily?
Thank you all for your help and input! Without BP I would still be lost
I'm interested in this as well - we'll probably be going the MF route!
@Nicolas Escobar Multifamily is not as seasonal as SFH, at least not for the same reasons. Being in a college town, the school year is your big driver. Most leasing will occur around June, so as you are looking, be aware of the current and upcoming vacancy, especially if looking at student housing.
Personally, I time all of my leases to roll over in June so I am in the middle of the busy student housing season. Currently I don't even have any students, but that is when demand is highest and if I have a vacancy, that is the best time.
Not really, at least not in my area. The market for MFH is limited to investors here almost exclusively (there are few "live in one, rent three" setups locally) and there's no real rhyme or reason that I can see as to why these places go on the market.
Something to keep in mind, depending on where you are at: there can be so few MFH on the market that it becomes difficult to tell if something is a good deal or not - you often have few comps to look at, either past sales or current offerings.
The best time to buy multi-family is when it makes money :)
The cheapest day of the year to buy a property is October 9th, on average you get a 15% discount.
MFH house buying isn't really seasonal. Especially in Texas. Buy when the right deal comes your way, and be ready to go. There are investors all over Texas waiting on MFH to crop up so make sure you are ready with your offer and associated paperwork at the drop of a hat.
The final piece to note is that you should buy a place that is a good investment AFTER you move out. House hacking is a good idea, but can be a trap if you aren't careful. Take a look at my before and after analysis on this post. The property he is buying is a good house hack and a good investment after he moves out.
Thank you @Brad M. that is awesome advice, especially because were trying to find a MFH as close to campus as possible (w/o spending a million lol)
@Ben Leybovich Thats the sage advice I expected lol
@Aaron Montague thanks for the heads up, Ive seen a few "cheap" MFH but I'm sure theres a HUGE reason. I will most def beware of those too good to be true deals.
Thank you everyone for the responses, I feel way more comfortable with my projected timeline (summer purchase) But if I can't snag one before then, Ill wait until Oct 9 @Vincent Crane
Any time you can find a motivated seller is a good time to purchase multifamily properties. They are much different than SFH and are analyzed differently, depending on the size. Your goal as an investor is to constantly be on the lookout for motivated sellers needing to sell their property. Motivation can be from relocating, divorce, burned out landlord, retirement, etc. Our job is to find these deals, and they happen all year round
Vincent Crane what is the significance of October 9th?
I'm also here in Austin. November and December seem to be our only true down season here in Texas. From Thanksgiving to New Years, less inventory is added to the market and fewer people are searching for homes. Sometimes this makes for great deals, sometimes a hard time to find what you want. Also a slow to find renters. On the flip side, prices tend to increase in March.
Best of luck.
@Nicolas Escobar I wouldn't let a calendar month influence when you purchase.
That said, there will be more inventory available in the spring and summer months generally speaking. But during the winter months you might be able to get better deals because there aren't as many buyers.
I have not bought my first income property yet. I have decided I would like to acquire a quad. However, at the moment, there seems to be none available in the towns I am looking. Therefore, I might end up with a duplex or two while I wait. :/