Advantages of Buying Multi Family as Primary Residence

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Real Estate Agent with Berkshire Hathaway HomeServices 2013000048

One of the smartest decisions a home buyer can make is to purchase a multi family home as his primary residence. A multi family home is considered a two family, three family or four family property. These are sometimes referred to as duplexes, triplexes and fourplexes. While the purchase of a single family home is a smart investment, there are definite advantages to purchasing a multi family home.

 

Income Stream
A multi family home provides an income stream from one or more tenants. This is the single largest advantage because it reduces the buyer’s monthly expenses such as the mortgage, taxes and insurance.

 

Higher Mortgage Qualification
Most buyers assume that the mortgage qualification guidelines will be stricter on a multi family home but many of the guidelines are the same as a single family home and often the income ratio will look better on a multi family. This is because part of the income the property produces can often be counted as part of the new buyer’s income. This means a buyer can usually qualify for a larger multi family home than a single family home.

 

Easier to Manage
If your goal is to have rental properties, then having your tenants under one roof is ideal. Rents are easier to collect and the upkeep of the property is easier to manage when you live onsite.

 

Future Rental
The owner of a multi family can easily decide to rent out their current unit and purchase another property. This makes a multi family purchase as a first time home buyer a terrific option. Many buyers will go on to purchase another multi family and grow their real estate portfolio and others will move onto a single family home to raise a family or for more privacy.

 

Great Investment
Maintaining the multi family home will make it attractive to tenants and will allow the owner to increase rents over time. This will also make the building more attractive to investors should the owner decide to sell. The more money the property brings in, the more money it is worth.

 

Retirement
Keep in mind that rents increase over time but mortgage stays the same. Once the mortgage has been paid off, the owner can choose to keep the property as a source of steady income or sell it for a profit. This makes a multi family home a great real estate investment.

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Rainmaker
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Barbara Todaro
RE/MAX Executive Realty - Franklin, MA
"Franklin MA Homes"

Good morning, Joseph Zingales an owner occupied multifamily home is a great way to start homeownership for all of the reasons you've listed.... and when you're ready for a single family home, you could refinance and draw out your down payment tax free....let the tenants pay the mortgage....

Jan 02, 2017 03:11 AM #1
Rainmaker
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Joseph Zingales
Berkshire Hathaway HomeServices - Concord Township, OH

Fantastic comment! The best reason to take money out of a property is to buy another property whether that is a primary residence or another rental property! Thank you for commenting and keeping the conversation going!

Jan 04, 2017 12:39 AM #2
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Rainmaker
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Joseph Zingales

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