Multiple SFR or 1 multi fam?

[Connor Williams]

Would you rather purchase 3-4 sfr with 25-30% down

or 

1 multi fam or commercial (apartment etc) with 20% down.

I would have 450k to work with.  

[Issac San Miguel]

Me personally, a multi fam, simply due to my comfort level with the asset class.

Both have upside of course - if you needed to recapitalize after your initial investment, you could always sell 1 of the 4 sfr

I'd say the decision lies ultimately in your short term and long term goals.

[Evan Polaski]

@Connor Williams, it really comes down to numbers and risk profiles of assets.  If everything is equivalent, I would look at the multifamily for ease of operations, generally, but there are trade offs to both.  As Issac noted, owning single family rentals, means you can sell one without selling rest.  But you have 4 roofs, 4 RET bills, 4 Insurance bills, 4 yards to maintain (potentially).

[Steven Foster Wilson]

@Connor Williams It depends on what your goals are. If you're looking to cash flow, then I would think Multifamily is the way to go.

[Connor Williams]

Those replies make sense. I think overall the sfr have a better chance at appreciation in the future. The cash flow would be about the same, right now being that you essentially hVe to buy your cash flow in my market 

[Issac San Miguel]

Quote from @Connor Williams:

Those replies make sense. I think overall the sfr have a better chance at appreciation in the future. The cash flow would be about the same, right now being that you essentially hVe to buy your cash flow in my market 

exciting times! i love washington state. my very best colleague is a wasu alum. there is a ton happening up there right now.

[Daniel Nobile]

@Connor Williams Are you planing to buy strictly as an investment property or a house hack? Also where in WA are you looking to invest? 450k for a small multifamily in the greater seattle area might not give you too much to work with. 

[Sherief Elbassuoni]

@Connor Williams, single-family appreciates more. Multifamily is easier to manage. It all depends on your end goals. 

[Gino Barbaro]

I would rather own one multifamily than multiple homes. One closing versus 3 or 4, one location, easier to manage. There are advantages to both niches, but I think the multifamily space is much easier to scale and to manage.

Good Luck

Gino

[Brandon Vukelich]

Like most all previously mention, depends on your goals but I would do 5+ unit MF all day long over a handful of SF. The best benefit I see from several SF is being able to liquidate a door at a time, as needed. Other than that you can't really force appreciation on a SF like you can for a 5+ property. SF are more at the mercy of comps. You can add value through improvements but still <4 units will still be subject to comps. You may add a bedroom or bath, improve the exterior but it's not the same. You can force appreciation on your commercial assets through improving the NOI. Increasing your NOI by $1000/mo or $12k/year on a current 6% CAP property, adds $200k in value.

[Corby Goade]

Plenty of great info above, but MFH are typically logistically easier to manage, but higher vacancy and turnovers, turnover costs are typically higher as well, but you would likely see slightly higher ROI too.

There really isn't a "right" option, give and take both ways. 

Best of luck!

[Becky Elder]

I agree with the comments above about your goals.  Appreciation or Cash flow or combination of both?  

There's less turn over with single family than mutifamily - would you be managing the properties yourself? 

I'm a Mortgage advisor and would be happy to chat with you about your goals and strategize with you on your plan.

[Alex Hunt]

Why 25-30% down on the SFR? I always advise for diversity amongst real estate holdings if you are holding for the long term. So I would suggest a mix of both, if possible. $450k is a lot of down payment money, with that I can have you approved to purchase up to $2,250,000. In which I am sure you could buy whatever you like.