Residential Investment
You can invest in many types of real estate. For each different asset class, there are different strategies to getting started and different exit strategies.
For Residential Investment, some optional asset classes are:
- Single Family Residences, Condos or Duplexes
- Apartments
Single Family Residences (SFR)/Condos/Duplexes
When investing in SFR/Condos/Duplexes, to strategize on
whether to do Buy & Hold or a Fix and Flip may depend on:
- Monthly Income or Residual Income?
- Multiple or One Time Investment?
- Be the Bank or a Financier?
- Subcontract the Work or Be the Contractor?
- Open to Partnering Opportunities?
- Flexibility with Time and for Income?
Many investors start out investing in real estate by buying a rental house, then another, and maybe a duplex. A next step may include investing in Apartments.
Apartments
Advantages of Apartments
- Immediate Cash Flow
- Lower purchasing price per unit
- Vacancy is relatively lower than Single Family Residence (SFR)
- Management cost per unit is lower
- Economy of scale
- One roof to maintain
- Less competition
- Can be part work
Disadvantages of Apartments
- Typically, one needs more money to buy an apartment than a SFR
- Management is much more complex than SFR
- You are dealing with Tenants and their problems
Difference between Apartments and SFRs
- Apartments
- Lenders look at the property first, your “team” second and the borrower third
- Valued by income
- Cash flow better
- Lender look for Debt Service Coverage Ratio (DSCR)
SFRs
- Valued by comparables
- Appreciate faster or depreciate faster
If Apartment Investing is for you, services that are provided by Commercial Investment Solutions include:
- Property Financials Overview
- Quickly Analyze Deals
- Guidance through the Purchase Process
RELATED QUICK LINKS: What is the Right Investment, Glossary Terms
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There are many considerations and strategies that come into play when investing in real estate.
To start:
- How much money do you have to work with?
- How much training do you have?
- How much experience do you have?
- What is your time frame?
- Do you have a formula for the numbers?
Commercial Investment Solutions can help you structure deals, finance them and create a constant stream of income for retirement. Some of our training and investment engineering also includes property management, asset protection, negotiating and tax planning to name a few.
Team up with our Team. Commercial Investment Solutions will guide you and customize a program that works for you. |
