The global pandemic has shaped the current state of all business sectors. Some were hit hard but there were some that were able to withstand its effects – one of those sectors is multifamily real estate.  

Multifamily properties are duplexes, apartment complexes, condo buildings that contain more than one housing unit for rent.  

According to Real Estate News Exchange, the multifamily sector remained to be a stable investment despite the COVID-19 pandemic. This is attributed to low vacancy rates and low-interest rates that encourage investments.  

In investing, risk matters. You need to carefully calculate the risks before putting your money into investments because there will always be the potential that you lose all of that money. This is why multifamily property investment is the bomb! It is the kind of investment that offers the lowest risk you can possibly have among any investments for the reward it delivers. 

This blog will tell you why a multifamily property might be the BEST thing on your investment portfolio as a beginner.

• Beginner-friendly  

While its name can be intimidating, a multifamily property is a good starting point for real estate investment.  

Most investors in commercial real estate often start off with multi-family properties because of its great opportunity without the crazy risks. For a newcomer in the complex world of commercial real estate, a multifamily property is definitely a sound investment. 

• Easier to finance  

Multifamily properties are generally more expensive than single-family properties. They have greater initial expenses.  

 At the surface level, you might think that acquiring a loan for a single-family property is more feasible, however, a multifamily property has higher chance of getting approved by a bank for a loan.  

A multifamily property will not be 100% vacant should one tenant move out of a property, which is the case for a single-family property. 

The multiple paying renters in a multifamily property generate better cash flow. With these, the likelihood of a multifamily property being foreclosed is lower than that of a single-family property. 

Lending institutions see multifamily properties as less risky investments; thus investors may be able to score interest rates.  

• Reliable income 

In a multifamily investment, you get an income at the end of every month. Therefore, these properties are generally more profitable.  

As mentioned above, unlike single-family homes that might appear to be safer and more affordable investments at first glance, multifamily homes can generate higher and steadier income because of the multiple rental units you can offer.  

With multiple tenants paying rent, vacancy risks are also mitigated, making these kinds of properties pose higher returns with a lesser amount of risk.  

• Tangible Asset 

Multifamily investment is something you can visit, touch, or feel. Unlike stocks, Bitcoin, or bonds, which represent a value, according to Forbes, investing in real estate, specifically in a multifamily property, means your ownership of the property is the value.  

It won’t simply go away chop and change because what you have is a tangible asset.  

• Easier Management 

Being a landlord to a multifamily property means you have to manage one property at a single location rather than multiple properties spread out around a community. 

Additionally, investing in a multifamily property is pretty straightforward. You don’t need to acquire multiple loans for each unit, unlike single-family properties or other commercial properties.  

• Scalable 

A multifamily property is perfect for those who are looking to grow their investment portfolio. This is because it is much easier to acquire a fourplex building than four individual single-family homes. With a single-family property, you need to acquire each property one at a time. This makes this kind of investment harder to grow.  

Around the Alberta area, the multifamily property market is looking great. An article from Western Investor says the province is the best market to invest in for multi-family. This is because Alberta offers the highest income per family, highest net migration and lower real estate prices.  

If you are looking for the first multifamily property that is perfect for you to invest in, visit Lapp Realty Commercial Group and find the best real estate agents to help you capitalize on the tremendous growth of the Edmonton-Calgary corridor.