Many people shrink from the possibility of buying a home as an investment and becoming a landlord.  They have visions of money-grubbing landlords showing up at the front door to collect rent—baseball bat in hand—and proceeding to get in a screaming match (or worse!) with the tenants.  Or there’s the fear of receiving the late night call that all the pipes have burst and the plumber needs to be dispatched right away, being paid double time for his work.  Multiply that fear exponentially by the number of units managed, and you get an idea of the public’s perception of owning multi-unit residential income property.  However, this view could not be further from the truth.  When done right the purchase of multi-unit residential income properties truly can be satisfying and an excellent way to invest your money.

Many savvy investors see multi-unit residential income property as a way of funding their retirement for the long term*.  They make sure that the rent covers the monthly mortgage payment for the short -term, and understand that their passive income is going to increase as rent increases while their monthly mortgage payment remains fixed.

There also are many tax perks* associated with owning investment property.  Everything from repairs, pest control, supplies, cleaning, utility expenses, property management costs and insurance premiums can all be written off in the maintenance of investment property.

Once you have decided to invest in income property you will find that there are many added benefits to buying a multi-unit dwelling.  First of all, less money is at risk if there is a vacancy.  For example, in the case of an 8-plex if there is a 10% vacancy, you are only losing 12.5% of your rental income.  Compare that to a single family home where a vacancy would mean losing all rental income.  Second, it is logistically easier to collect multiple rents from one location, rather than from various locations.  Third, as there are always transaction fees associated with buying a property such as closing costs, inspection fees and title fees, it is more cost-effective to buy a multi-unit property because the transaction fees are comparable to the purchase of a single-family dwelling.  Finally, because there is typically less competition for multi-units versus single-family homes, frequently you can get a smoking deal.

For all of these listed benefits of owning a multi-unit investment property The Sugar Team is proud to be offering a solid investment opportunity located at 512 and 516 Madeira Drive SE.  They are two four-plexes being sold together (8 units total) for $370,000.  The one owner has lovingly cared for both properties for over 17 years and it shows.  The units are all separately metered for gas and electric (the tenants pay their own usage) and at the end of the buildings there is a larger ”master’s unit.”  It has been a great income producer and has potential for more.  The tenants love living at Madeira (one just moved out after 17 years!) which you can appreciate by admiring the central courtyard, refrigerator in every unit and convenient proximity to Walmart.

*Like any major investment, it’s always a good idea to consult your financial adviser and CPA first.