When you think about buying your first home, or your next home, single family houses or condominiums are probably top of mind. But maybe you should take a closer look at the opportunity that a multi-family home can offer you and your family. Purchasing a multi-family (sometimes called a multi-dwelling) home is a great investment and a smart strategy to save for your future.
There are so many possibilities when it comes to owning a two or three family home. Sure, they may come with a bit more upkeep and you will want to do your research and take classes if you are planning to be a landlord, but they also bring great value through their opportunities for income generation.
Local residents are certainly recognizing the potential of owning a multi-family; they are in high demand in Amesbury as well as on the North Shore and Seacoast. In July alone, I sold these tree multi-families in Amesbury (interesting that they are all yellow!):
Here are a few reasons you might want to consider purchasing a multi-family home:
You have a large family who may benefit from living nearby each other
You enjoy home projects and renovations
You are interested in earning money through rental income
You are interested in turning units into Air BnBs
You are interested in using real estate to save for the future
If you are intrigued by these possibilities, here are 3 key benefits that I see of owning a multi-family property.
Live in one side, fix up the other
Does your new home need some upgrades? No problem! Often we purchase homes knowing they may need some work, and if you live in a single family home, you end up stuck living in the home or living with family during loud and messy renovation projects. If you have a multi-family, you can renovate one residence at a time without incurring additional costs or headaches. You can then move into the completed unit and begin work on other units in the building.
Once you have taken your landlord law classes and prepped your unit, you are ready to welcome tenants (and monthly rent payments!) Use these payments to offset your own mortgage payments or to pay off your home faster. Remember, even if you have renters, you will want to plan to have enough money available to pay the mortgage on your own each month just in case your tenant is unable to pay. You are still liable to the bank for the whole amount each month.
Saving for your Future
So, what happens if you pay off your mortgage? Or if after a few years you want to move into a single family home, or to a new location all together? That’s fine! You don’t have to sell -- continue to rent every available unit to either pay your mortgage, or use the money as income that you can put towards other financial obligations in your life (like a summer house, retirement, or college!)
Of course owning a multifamily might seem daunting. In my experience, it is very important to do your research and understand your financial obligations as well as landlord rules before you welcome your first renters. Want to scoop one up and take advantage of these benefits? Or maybe you are interested in learning more about the opportunities in the area? Reach out to me and I can assist you with your home search!