Real Estate is a great option for building equity or income generation. Unfortunately, there’s a misconception that real estate investing requires you to get hands-on with countless details every day. Very few people are aware of the passive investing opportunities in multi-family private placements or apartment syndications. These strategies are all about pooling money together with other investors to purchase large assets. A syndication structure works well because it allows you to own an apartment building for a little investment compared to what the property is actually worth.
Multi-family real estate is a diversified asset in itself. This is largely due to the fact that when you buy an apartment building, you are investing in many units. With single-family homes, you have only one unit and one tenant. If your tenant moves out or doesn’t pay rent, you are 100% vacant and 100% unprofitable. With a 200-unit property, you could have as many as 30 vacancies and still be profitable. Also, many people invest passively in syndications because they can spread out their risk among several different properties.
Advantages of Multi-Family
- hands-off approach to investing in real estate
- tax advantages equal to or exceeding single-family
- recession-resistant asset class
- There’s a nationwide demand for affordable housing
- You are able to leverage the expertise of your team of investors