MFR vs SFR and possible increased cash flow vs appreciation

2 Replies

I am new at investing and have about 50K that im looking to invest. I would rather get into multifamily properties but all those in and around my area (for 30-50 miles) are in C-D neighborhoods. However, the SFR that look like theyre discounted enough are also in those areas. The SFR that are in good locations are all at market value BUT the market is good with steady demand and market appreciation and growth.

would it be wiser to take a chance on the possible cash flow with the multifamily OR get a start with less cash flow but great appreciation and steady tenants?

@Joshua Kohl What area are you in? If you put that in your profile it will show up when you post and make it easier on us to help.

Your question is hard to answer without more information because a lot depends on your personal situation. 

If you are looking to grow and get into REI in a big way, aren't afraid of a bit of risk, want to be actively involved and don't mind getting your hands dirty, I would encourage you to buy multi-families in C/D areas.

I say this because that's probably where the most money is to be made but it will also be more risky and more work and headaches on your part.

If on the other hand you're fairly conservative (financially), want somewhat of a hassle-free investment without taking much of your time, just pay market prices for a really nice house in a great school district even if it has minimal cash-flow.

Over time, you will get great appreciation and build wealth through loan pay-down even if there isn't much cash-flow.

I personally do both plus a number of other things for diversification reasons. I make cash flow from my lower-end multi-family properties and I make appreciation from the higher-end SFRs.

Thx.  I have 6 kids, ages 9 months to 9 yrs.  I work full time so don’t have a lot of extra time to invest in the property.  Savannah has c/d properties that will cash flow and Richmond hill has the market value and appreciation.  Thx again for the advice!