Tuesday, February 10, 2009

Phoenix Real Estate - Are There Advantages to Multi Family Units?

If you are looking to invest in real estate in the Phoenix area, you may
want to consider putting your money into multiple family dwellings.
Considering the current downturn in the economy, it really makes
good sense to invest in this type of housing verses a single family
home. Here is some information that will help explain why this would
be a smart decision.

Creating wealth through real estate investing is something many
savvy business people do. What are the advantages of putting your
money into small residential income properties? Suppose out of 10
units, 2 are vacant. The monthly costs to the investor are much lower
than that of an empty single family home. Make sense?

Here is an example:

Let's say owner "A" invested in a single family home of average size
that normally rents for $1200 with a mortgage of $1000 per month.
This home is now empty, and for one months mortgage the owner is
out $1000. This comes out of his own pocket.

Now, owner "B" has a 6 unit multi family dwelling and each unit rents
for $700 per month. The monthly mortgage on this property to the
owner is $3000. Two units are vacant, which means he will receive
$2800. This only leaves the property owner $200 short of making his
mortgage payment. Now, think about the outcome to you, the
investor. Would you rather have $1000 or $200 coming out of your
own pocket for that months mortgage payments?

This is one of the benefits of investing your money in multiple family
. You can see why putting your money in a single family
home isn't such a good idea when you can spread the risk among
more units. This helps you to create a more efficient cash flow for
yourself and create future wealth. Can you see how investing in
several multiple dwellings could help secure your financial future?

Owners of multi family dwellings also have plenty of other advantages.
With repairs, for example, you can write off a portion of the cost in
many cases. When you own a single family unit, you get no
immediate tax benefits.

Investing in real estate is one of the best ways to insure that your
future is secure. Real estate and residential properties rarely ever
decrease in value, and tend to increase over the years. Of course,
investing in single family homes is a good decision, but diversify and
put some of your money into multiple family dwellings.

Of course, the negative aspects of owning a multi family dwelling will
come to mind, such as getting calls from tenants with repair and
maintenance problems. This does occur, but it really isn't as often as
you imagine.

The hard and fast facts are that multiple dwellings will insure that you
have a steady income stream that is as recession proof as any
investment you could possibly make. Your family's financial security
depends upon making smart investments, and this is one of the best!

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