At Fetch Home Management, we work with both single-family homes and multi-family units. Both classes of residential rental properties make excellent investments, but for different reasons. If you’re thinking about investing in Lancaster real estate, but you’re not sure which type of property to focus on, we have some things for you to consider.
Single-Family Properties in Lancaster Attract Long-Term Tenants
A single-family home is always a great investment option because they are always in demand among highly qualified tenants.
The tenants you attract with a well-maintained single-family home in a good location will want stability, and they are likely to take care of the home just like it’s their own. They are usually tenants who are interested in home ownership but prefer to rent because of the low-maintenance and flexible lifestyle it provides. Single-family homes appeal to tenants who want good school districts and proximity to commuter routes and shopping.
Single-family homes also offer investors some great appreciation potential. These types of properties always increase in value. In Lancaster, you can expect to cash flow your single-family home and build some equity quickly. The cost of these homes is not as high as in some other markets in the northeast, and you’ll collect a pretty consistent and reliable rent.
One of the challenges to owning single-family homes is that your maintenance costs may be higher. Even if your property is new or in good shape, you’ll probably spend a little more keeping it in excellent condition. There may be landscaping costs that you cannot pass on to your tenants. Unless you’re paying in cash, you’ll probably need at least 20 percent down when you’re looking for a mortgage, especially if you’re financing your investment through a traditional bank.
Multi-Family Properties in Lancaster Provide Protection Against Vacancy
Multi-family properties are often duplexes, triplexes, or even small apartment buildings. When you invest in a multi-family property, you’ll have more than one tenant in place, which means you have more than one rental income stream. This is the major benefit of investing in multi-family properties; you will have rent coming in from various sources. So, if one unit is vacant, you aren’t losing a lot of money quickly.
You still have rental payments coming in from the other units.
Economy of scale is another benefit to renting out a multi-family unit. When you need maintenance or landscaping services, you can contract with a vendor who is likely to provide a discount because of the volume of work you need. You’ll save time and money maintaining a single building with two or three units.
Tenants are more than neighbors with multi-family units; they’re often sharing walls and communal space. This means conflicts and disputes can arise between your tenants more frequently. There might be complaints about noise or parking or trash or pets. This can take some extra time and lead to frustration for you as the landlord.
We think there are excellent reasons to invest in either type of property. The best decision for you will really depend on your investment goals. Our team would be happy to help you evaluate your options and fetch the right property. Contact us at Fetch Home Management.