HI Frank, I am coming to the party late, however I have been busy working with both Single Family and Multi Family investors lately. There have been a number of different scenarious for each different client. We have learned the current market cap rate to be 5%-9%. We are looking for 8%+ and 10%+ is the golden egg lately.
Vacancy rates used has been 5%-6% ,generally.
The big question! Which15 year investment opportunity will deliver a better ROI. I can only genralize here due to the unkown factors in your investment dollar pool (Initial Investment, Mortgage Rate & Management Vehicle) compared to purchase price/ condition/location. Imperical data will help some.
A typical SFH investment return will more than double in 15 years. A Multi Family will not see a double return in the same period. It is definetly investor specific if one is a better choice. Multi Family investments are most commonly used as a shelter if held under 15 years....a low risk low return piece of the Real Estate portfolio. The former would be considered an equity leverage position to further develop the portfolio...used as a higher risk higher return piece. It is imperative to have collaberation betweeen a great Tax Accountant and Realtor working on your behalf specifically.
I refer to the attached link as one of my research data points. I bet an information thirsty person like you will find it addicting too.
This is one great time to develop your investments.
I know that this message posted in January, but I thought I would get back to you anyway.
Have you found the property that you are interested in. My partner just listed a 4-plex in Sunnyvale and in Mt. View and has received offers within 1 week. We are telling people to come in with 30-40% down to avoid negative cash flow.
Have a great day!
As a fellow homeowner/resident and real estate agent in the Downtown Sunnyvale area, it is highly likely that the homes closest to the Sunnyvale Downtown Redevelopment area will appreciate once the center is open. For example, look at Santana Row. A friend of mine from Manhattan visited her Father in Salinas, she shared with me that the parents had taken her to Santana Row in San Jose while she was visiting. Imagine that, driving 1 1/2 hours to Santana Row!
These attractive centers draw visitors and interest not only from the immediate area, but from a distance also. Homes listed for Sale near Santana Row have that added value. The buyers desire the added plus of being able to wak to such desired centers and relax as if they have taken a trip to Europe.... more