Multifamily Real Estate 101

How We Can Help You Make a Profit as a Multifamily Property Investor

Multifamily housing is a specialty of CTG Real Estate Services. If you’re looking to purchase multifamily properties and lease them out for a profit, our professionals can help you through every step of the process.

Like with any other real estate industry, it’s important that prospective investors and owners understand all the details and responsibilities of owning multifamily housing before starting. In this industry, it’s about more than just finding multi-family properties and renting them out; it’s about proper management to keep and retain tenants. Unlike other real estate professionals, CTG Real Estate Services can assist you with both aspects.

You can always contact our professionals to learn more about this industry, but we’ve also answered some of the most commonly asked questions about multifamily residential real estate to help you get started.

What is Multifamily Real Estate?

The multifamily housing industry involves buildings that are designed for residential purposes on a grand scale. This typically means multifamily housing like apartment buildings or complexes and townhouse complexes. Residents within multiunit properties do not own their spaces; they rent them as a source of income for building and complex owners.

In return, owners provide property management and facilities services to keep their tenants happy — and motivate them to renew their leases year after year. Being the owner of a multi-dwelling unit does come with additional responsibilities, but the right property management company can give owners a peace of mind.

Often, the process of investing in multifamily real estate involves purchasing low-class buildings for a cheaper cost, investing money into renovations, and being able to charge higher rents for more attractive spaces and amenities.

What Should I Know About the Multifamily Housing Industry?

Choosing to invest in multi-family properties is a big decision to make, especially in regards to finances. Usually, when investors are deciding between single-family vs. multi-family homes and choose the former, it’s because that option is financially cheaper upfront. Buying multiple dwellings will come with a hefty down payment and overall price tag, even though it can be recouped through monthly rent payments by tenants.

Before any prospective investor decides to purchase multi-family residential housing, they will need to determine what their personal goals are. This means creating a list of their asset criteria, or the qualities that real estate professionals will use to locate the right properties for them. Usually, these include:

  • Type of multifamily housing (apartments or townhouses)
  • Location
  • Prospective tenants
  • Budget for acquisition, renovations and monthly upkeep
  • Desired monthly rent rate
  • Availability for renovations and future updates
  • How much direct involvement they want in the management of their units

While multifamily real estate professionals can discuss these criteria with prospective investors, it’s important that a base understanding of wants and needs is determined prior to beginning the search.

One of the unique criteria associated with buying multifamily property is a capitalization rate, also known as a “cap rate.” This statistic is the rate of return expected on the property based on how much income an investor believes it will generate. You can calculate a property’s cap rate with net operating incomes and recent sales prices of comparable properties. Knowing what you expect as far as a cap rate will help guide you and your professional toward the right multifamily residence for you.

What Multifamily Real Estate Services Does CTG Real Estate Services Offer?

CTG Real Estate Services specializes in representing potential buyers of multifamily housing. Our professionals have connections to hundreds of potential sellers — which means more opportunities for you to find the perfect multifamily property for your goals. And we’re not just working with properties already listed for sale; our unique partnerships with sellers gives our clients access to thousands of off-market properties, as well.

Our CEO and founder Chris Gardner is a national multifamily industry consultant and, after he helps you find a property, he can guide you through the legal process of negotiating and signing a bill of sale, as well. But that’s not where his services have to end. Our company offers unique “turnkey solutions” to help you prepare your new property for profitable leasing.

CTG Real Estate Services has access to hundreds of vendors to help you through your renovation, move-in, and management processes in your new space. Chris Gardner can connect you to his contacts and guide you through the request for proposal and contracts stage — all integral steps to finding you the perfect property management company for continued success. If the location you buy is not already fully leased, Chris can help you get there.

When you work with CTG Real Estate Services, our professionals are more than simply consultants; they are partners in helping you achieve the specific goals you have. We will work together with you and any potential sellers to reach the best solutions for both parties.

To learn more about our services and start your search for multifamily real estate today, please schedule a consult with our team.

 

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