Single family to multi, convince me
I have heard numerous times from multi family investors that if they had it to do over, they would have skipped the singles all together.
However, I just don’t see the returns in multi. I currently own just under 60 properties, all singles, all very close in proximity to each other and purchase approx 1 per month. All “c” neighborhoods. Have a great system in place for renovations since most of what I buy is distressed.
Making an avg of 500 per door after everything including debt service and my COC after financing is usually around 50 percent and need no outside investors.
I just can't get those returns on multi. I totally understand buying multi and raising NOI to increase value but I'm not looking to sell in 5 years so cash flow is really the only thing important to me.
Am I missing something? Given these returns, would you still do multi?
Most Popular Reply
@Alan G. congratulations! It seems that you have the sfr game figured out. Most people aren't capable putting together the systems and the teams to make scaling work in the sfr space. If all of your properties are cash flowing and making money with no turnovers. Why fix something that isn't broken. But with that being said, just as you have 60 SFRs that you have acquired over time. You can acquire one 60 unit apartment community with one transaction. You may have a few roofs or ac to replace, but not 60 overtime. Management is less intensive and cost efficient with one 60 unit property opposed to have 60 sfr. There are many pros and cons to both. I love the fact the value lies in the NOI and not comparables based on what the next person has done with their home in that neighborhood