MULTI-FAMILY 2-10 UNITS
DUPLEX
Duplex may be stacked one atop the other on separate floors, or they may be side by side with a shared wall
Rather than owning just one home, you own two. If an investor rents out the other half, this revenue can drastically offset the expenses and potentially make duplex living cheaper than what you'd pay for a freestanding house. It's a popular option for people who want to keep family members nearby or who want a steady income from a place that's not too far away to manage.
TRIPLEX
Triplex is 3 legal family units. They can often be 3 separate floors, or they may be side by side with a shared wall
When an investor lives in one unit and rents out the other two units, the revenue can usually cover the mortgage. It is a common option for people looking to "house hack". The idea is to have your tenants pay for your mortgage and sometime possibly generate positive cash flow. Thus allowing the investor to live for free while building up the house's equity.
QUADPLEX
Quadplex is 4 legal family units. They can often be 4 separate floors, or they may be 2 duplex side by side.
Quadplex not only can allow the investor to live for free most of the time. It can also generate substantial cash flow. Think of it as a secondary income or part-time. Quadplex is also the max unit limit which most conventional banks will lend to. Therefore, giving an investor the maximum leverage at the lowest cost.
5+ UNITS
5 Units+ are considered as commercial units. They are often a big house with 5 units or 5 houses side by side.
5+ units are in a different world than duplex, triplex, and quadplex. The number of units means the greater the possible cash flow it can generate. It is also much more cost effective in terms of reducing management cost and acquisition cost. However, most conventional banks would not lend to 5+ units, so a commercial loan will be needed.
MULTI-FAMILY
INVESTOR
INVESTORS, AGENTS, AND BROKERS
If you are looking to sell your multi-family and or apartment complex. Whether they are in a distressed condition, please send us the information about the properties as we do buy them for our investors' portfolio. Our email is acquisition@kingwoodinvestment.com
APARTMENT
COMPLEX
INVESTOR
An apartment complex is truly a sophisticated investment. They often range from 10 to 500 units
The scale of an apartment complex will determine the complexity of the acquisition. A thorough analysis must be performed for potential profit as well as risks involved, including the strength of the local rental market (vacancy and delinquency), type of market you are buying into (C class buildings usually have more tenant turnover and higher repairs and maintenance than A or B class buildings), interest rate on the financing, and how much leverage is being used (size of the down payment).
Risks come with the reward, there are opportunities in repositioning deal which equity can be recognized as a discounted price, fixer upper – “force appreciation” potential, rezoning opportunity, poor management, and foreclosure. There are many ways to create equity, but buying into equity is the best approach which profit is made when the asset is bought not when it is sold.
