If you already own a single family home and are looking to build your real estate portfolio, multi-family properties are the next logical step. They provide rental income and the opportunity to build equity. If this is your first multi-family purchase, here are some tips for first-time buyers of multi-family properties.
Getting pre-approved should be one of your very first steps. Although you may already have a loan for your primary residence and therefore have gone through the mortgage process before, there are some important differences with investment loans. Contact a loan officer to get pre-approved and to understand what might be required. Knowing your price range before viewing properties will save you valuable time and energy.
Work With a Multi-family Real Estate Agent
The next step is to connect with a real estate agent who specializes in multi-family properties. Buying a multi-family can be quite different from single family homes. There are tenants, leases, utility arrangements, market rent calculations, cash flow, and other matters to address. Real estate agents who specialize in these properties will be familiar with those intricacies and can better assist you with the process.
Fine Tune Your Goals
One of the most important tips for first-time buyers of multi-family properties is to understand your goals before setting out to find a property. Otherwise, you could spend endless months reviewing listings and visiting properties that simply don’t fit your needs. Are you looking for a Class A property that is newer and requires little maintenance? Or is a Class C property that needs improvement and has greater appreciation opportunity more appealing? Or would like to stay in the middle, with a Class B property? What type of cash flow do you prefer? What are your goals for the long-term? Will you fix and flip, buy and hold, or convert to condos? An experienced multi-family real estate agent can help you figure some of this out and fine tune your search criteria, allowing you to achieve your investment goals more quickly.
Monitor the Market & Be Prepared to Act Quickly
Once you’ve done all of the above, it’s time to monitor the market. To stay up-to-date on new multi-family listings in Massachusetts, be sure to create an account on our website and save your search criteria. You have the option to receive email alerts on new listings once a day or up to every hour. The market is hot right now, so if you see something you like, be ready to act quickly! Inventory moves fast, especially when priced right.
More Tips for First-Time Buyers of Multi-Family Properties
Our network of real estate agents specialize in multi-family properties. In fact, many of them own properties themselves, so they understand first-hand how to evaluate and purchase solid investment properties. Reach out to us to be connected to an agent and to receive helpful tips and tools on being a property investor. Be sure to ask about our first-time buyer program which includes valuable resources, coaching, and investment support.