Real estate investments are the best. There are many factors that determine whether it will be beneficial for you to invest in single family homes or condos. One of the main factors here is the annual returns that you expect on your investment or also called as cap rate.
According to Rocco Basile, if you can afford to invest in single family home, buying it is a wise idea since they decline far less in correction and generally rise more in the bull market. The following are some relative pulses of the single-family homes over the condos. Read on and get informed!
Reasons why you should invest in Single family homes over Condos
When it comes to single family homes, you have higher opportunity to expand it whereas you can get stuck with footprint of condo. For the ones that have smaller family or even no family and want great financial returns, buying multi-unit property can be a good idea.
Moreover, condos generally cost more than single family homes having same size. Condo fees might increase that can overall increase your cost burden with passage of time. Apart from it, Condo homeowner rules might restrict you on using how to use the property and might make it difficult for you. Sometimes, such rules may even prohibit you for renting your condo to others.
However, for large investors, buying multiple condos might be beneficial. Sellers might want to drop asking the prices on the individual units for the buyer that takes several units. The new owner may then sell of units separately for their gain.
Efficiencies of single family home
Small time landlords that don’t generally employ the property managers can find maintain single family homes easy than the multi unit building. You first need to buy property for better lifestyle first, for rental income second, capital appreciation third! You may not be able to enjoy maximum rental income in case you decide renting out your home and buying other great place, but you can get best benefit of enjoying your own money that can outweigh the benefit of making more money with money!
Condos are normally cheaper to obtain and might offer high rental income yield. Its downside includes HOA regulation and HOA fees that can restrict your rental freedom as well as reduce the rental profits. You can be king of your own condo but not the kind of common domain. For the ones who can’t afford single family home or like to spend lesser time on maintenance must consider investing in a condo.
When it comes to investing in single family homes, it normally offers better capital appreciation, more tenant flexibility, more expansion potential, less tenant turnover. Its downside includes low rental income yield and more maintenance. For the ones that like to live in home and make improvements and then renting it, Single family homes can be a better investment property for them.
With the above tips and suggestions, you are sure to decide, which option is best for you. Contact construction expert Rocco Basile now and get the best guidance by him!