5 Benefits of Investing in Single-Family Properties

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5 Benefits of Investing in Single-Family Properties

Investing in housing is a safe bet, as regardless of the economic situation, a place to live is a basic human need like food and clothing. As such – if you have a property in reasonable condition, in a decent neighborhood – chances are you’ll be able to either generate some rental income or have the opportunity to sell for a profit.

One of the most popular housing types investors consider when looking at the market is the single-family home. These homes are usually designed for a single-family and are typically single, stand-alone structures.

 

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These can make attractive investments for novice real estate investors to learn the ropes and start building up a portfolio slowly but steadily. We’ve prepared a list of 5 benefits investors could expect should they pull the trigger on a single-family property.

 

Table Of Content:

  1. Immediate cash flow
  2. More control
  3. Better quality tenants
  4. Faster appreciation
  5. Easier to manage

  1. Immediate cash flow

An attractive benefit of single-family homes is that they usually start generating income through rent immediately, which can be used to pay down the mortgage of the property. This is an attractive option as investors can cover their financing costs via the income generated by the property. Rent from a house tends to pay more than rent from a single apartment (though multi-family properties can generate more revenue thanks to offering space to multiple tenants). The income can also help to fund retirement or other financial goals – a long-term source of income for real estate investors.

 

  1. More control

As the sole owner of a single home, you have the ultimate decision-making ability on when to rent it out, how much to charge, and when they should sell. This level of control can help them tailor their investments towards their specific objectives, helping them achieve their financial goals.

 

  1. Better quality tenants

In any investment that requires managing tenants, you can always come across tenants that make your life miserable. That said, tenants looking to rent a house are usually more reliable than apartment renters and typically take better care of the home. However, human beings come in all temperaments, so should you find yourself unlucky, you may get stuck with a nightmare tenant. Always vet the potential tenants via interviews and background checks if possible. Also, have an explicit clause in your agreement to handle termination of the lease or eviction.

 

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  1. Faster appreciation

Several factors can contribute to a property’s appreciation; however, a general rule is that single-family houses appreciate faster than multi-family properties due to economic growth, inflation, location development, and housing demand. This appreciation can help investors charge more for rent or ultimately sell for a healthy profit should they wish to part with the investment.

While never a guarantee, historically, property rates tend to increase over time in most areas.

 

  1. Easier to manage

As it’s only a single property, it is easier to manage a single tenant or family, maintain the property, and even attend to the occasional minor repair depending on your ability. The amount of time and effort you should dedicate to managing the property will be minimal, and this is a great way to get a taste of what being a property owner or landlord entails with little risk.

 

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Conclusion

Should you decide to invest in a single-family property, you may find it profitable enough that you may want to develop the property into a duplex or even look out for other, larger multi-unit properties to invest in. The good news is that you will have a solid foundation to build on according to your real estate strategy. Even though the scale can be significantly different with multi-family properties, the fundamental concepts remain the same.

Regardless of where you are on your investment journey – looking for your first small home to buy or purchasing a large, multi-building apartment complex – securing funding will never be a problem again. Our team at RE Investor News is available to help you discover new funding options to unlock exciting and limitless opportunities for your next real estate investment. Contact us now to discuss your options with an experienced and qualified specialist.  

 

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