Local apartments vs. distant single unit rentals

Local apartments vs. distant single unit rentals

I'm trying to figure out if I should use our cash for a down payment and carry a note on one local, cash flow positive multi-unit complex or take the cash and buy out right multiple single family residences out of state? My wife's family is in that state and I realize there would be huge tax benefits when we travel back on leisure to visit. I intend to keep whatever we purchase as a long term income producer and not too concerned with resale. I'm in the early stages of trying to establish rental property income and wonder what's the best use for our cash.


Just my opinion

I am in the single family residnce camp. My reasoning is that their are many displaced home owners (foreclosure) that would like to still live in a home. You have more options to resale, to a wider group of people. You could offer your SFR on Contract for deed for 40yrs at 10% and collect the cashflow every month AND not have to worry about maintaining them because the tenant/buyer is responsible. You could lease option them or just strictly rent them, and sell them 5-10years down the road. Your buyer pool is bigger for SFR rather than MFR. That's just my opinion.



Cathy B

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Thank you so much. The

Thank you so much. The resale aspect certainly makes sense and I never considered the lease option. I've been told by some that buying a multiunit is a greater safety net because if one unit doesn't rent, you still have the others; if an sfr doesn't rent, you're out 100%. What do you think? Also, is a rental a good deal even if the cash flow is minimal but positive, or does it have to meet a specific minimal margin?

SFR v.s Multi-unit


That is a good argument that I too am considering. However, as cathyb shared, the market now is ripe for sfr leases; and as such, should not have difficulty locating tenants.


Owning multi-units can cover some losses when one or two are vacnant.

I'm looking for both, with a stronger emphasis on sfr properties. If the right multi-unit comes along, I might just have to consider it.



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