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James Wise#4 All Forums Contributor
  • Real Estate Broker
  • Cleveland Dayton Cincinnati Toledo Columbus & Akron, OH
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Would you rather buy a SFR, Duplex, Quad or 10+ unit....Why?

James Wise#4 All Forums Contributor
  • Real Estate Broker
  • Cleveland Dayton Cincinnati Toledo Columbus & Akron, OH
Posted

Simple question. What do you prefer investing in & WHY?

  • Single Family Houses
  • Duplexes
  • Quads
  • Apartment buildings (10+ units)

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Michael Ealy
  • Developer
  • Cincinnati, OH
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Michael Ealy
  • Developer
  • Cincinnati, OH
Replied
Originally posted by @James Wise:

Simple question. What do you prefer investing in & WHY?

  • Single Family Houses
  • Duplexes
  • Quads
  • Apartment buildings (10+ units)

50+ unit apartment buildings. Why?

  1. Economies of scale which leads to lower cost per unit for almost everything (maintenance & repairs, capex, property management, etc)
  2. Little income improvements through more efficient management leads to HUGE increase in equity.
  3. You have on-site management and maintenance since the property can afford it - so it becomes more passive (notice I didn't say totally passive because it's not)

Now they are harder to sell - but that also makes them easier to buy specially when you have a motivated seller on the other end. You can do more creative acquisiton techniques (seller carry back financing, deferred maintenance credits, etc) which lead to no money-down opportunities.

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