Economies of Scale in Multifamily Investing

ONE ROOF

Having many tenants under one roof provides you the ability to employ professional property management, allowing you to manage your manager from wherever you may be, no plunging toilets or chasing rent checks!

BETTER CLASS OF PROFESSIONAL

From Property Management to building trades, having a centralized property rather than smaller scattered site single-family homes will lend itself to hiring a better class of professional, as opposed to a handyman.

Making sure that your tenants get their service calls attended to promptly is essential in retaining that tenant. A property management renewal fee is a fee we’re happy to pay.

PROTECTION FROM VACANCY

Your risk is substantially reduced because there are many tenants paying your mortgage. One vacancy in a 50 unit building is planned for and hurts much less than when your single-family tenant moves out. These single-family “cheap” rentals are what many real estate investors are offered as an entry point to real estate investment – we challenge you to think bigger!

TAX ADVANTAGES

One of the tax advantages of investing in apartments is the deduction of furniture, fixtures and equipment. Standard disclaimer *I am not an accountant, so make sure that you go over all tax allocations with your accountant.

SAME EFFORT, MORE PROFIT

Not only does economy of scale favorable compare apartments to single-family rentals, but also pertains to smaller vs. larger apartment properties. Two vacancies in a 10 unit building is 20%! With all of the front-end work that you as the potential owner puts in for market research, due diligence, making the deal, and asset management, I urge you to consider putting those same efforts towards a 40 unit rather than the 10. The work is about the same with larger upside!