Are you looking for a way to make money in the real estate market? Some investors swear by buying a multifamily home for sale because you get rent from not one but several renters. However, depending on your personal goals, buying a single-family home for sale in Fort Wayne, IN, is often the better investment. In this post, you’ll learn more about the benefits of purchasing single-family homes and can use this information to help you make a sound real estate investment.
The biggest advantage of buying a single-family property is the cost. Multifamily dwellings often cost more up front and require a down payment that can be as much as 30% or more. If you find the right lender, you might have the opportunity to purchase a single-family property with a smaller down payment between 15%-20%.
Don’t forget that you’ll need to insure your new property. Insurance rates for multifamily properties can be a deal breaker for the first-time investor. For cheaper insurance rates, single-family units are the way to go.
When you take your time and research the properties for sale, you can get some great deals. It’s not unusual for a first-time investor to find a home for sale that’s well below market value because the current owners need to sell fast. Relocations, divorces, and financial issues are a few examples of why people sell great properties for less.
A common roadblock that new home investors run into is that they bite off more than they can chew, or they decide they don’t enjoy being landlords. When this happens, selling the property quickly is the fastest way to earn back part of your investment. Single-family homes sell faster than multiunit properties.
Fewer Maintenance Issues
With single-family homes, you only have one HVAC system, plumbing system, and electrical system to worry about. In a multifamily unit, you could have several systems that need updating or repairs. This can get overwhelming fast. For the first-time real estate investor, it’s always a good idea to stick with a simple investment in the beginning.
Lending restrictions are laxer for single-family homes. You’re also more likely to get better rates and longer mortgage terms. The income-to-debt ratio limit might be higher too, which means it will be easier for you to qualify for loans.
What you might not know is that appreciation values get figured differently between the two kinds of investment properties. Multifamily properties have their value based on the amount of rent being collected and the property’s overall condition. Single-family properties usually appreciate faster.
Consider Newer Properties
As previously mentioned, people sometimes have to sell their homes fast because of financial difficulties. It’s not unusual to find a newer home for sale in Fort Wayne, IN, that’s below market value because the previous owner purchased a property they couldn’t afford. These are great opportunities for investors. To learn more about newer properties for sale in the area, contact Lancia Homes at (260) 489-4433.