2 of 3

Write now Article Tools

How to Buy A Multi-Family Home

So, you want to buy a home, and you think a multi-family is the way to go. Well, you could be right. A multi-family home offers an opportunity to get into a home and build equity sooner than you might be able to get into a single family home.

How do you know if this is the right move for you? There's a lot to consider.
On the plus side, you'll have additional people contributing financially to pay your mortgage payment. It's nice to buy a house with somebody else's money! And on the long term, you can eventually rent out your personal apartment, create a positive monthly cash flow, and move into that single family that you couldn't afford when you first started looking.

Before you make that decision, however, you must do your homework. Consider:

Location: Multi-family homes are generally located in more densely populated areas, on smaller lots, and often in the older sections of town. Is this where you want to live? No problem? Okay, next consider:

The property: Most town's zoning confines multi-family homes to specific areas of the community, so many of these "multi's" are older rather than newer. In some areas of the country, that means very old (over 100 years). So, as a prospective landlord, you'll want to assure yourself of the condition of the property, its mechanical systems, and costs of updates. You may also need to be concerned with lead paint risks and regulations, especially if your renter has children.

You're going to be a landlord now, and that means you have to maintain not just your own home, but the units your tenants are living in as well. If you've interviewed your tenants carefully, done a credit check, verified references and filled out a proper lease, you may do quite well. It's also good to think about a clause requiring tenants to be responsible for repairs under $100.00 (or some other agreeable amount). If they know it's their responsibility to unclog the drain, they'll usually be a little more careful about what goes down it.

Now, don't forget. Tenants move in and they move out. And sometimes they don't take care of the property the way you would as the owner; because it isn't theirs. When the tenant moves out, you have another set of things to consider.

Is the property damaged now?
How much will it cost to restore it so I can rent it out again?
How long will it take me to get it ready for the next renter?
Do I have financial reserves on hand to cover the whole mortgage payment while the vacant unit is being

• 1
• 2
• next page >>

Add your voice

Know something about How to buy a multifamily home?
We want to hear your view. Write now!