- September 25, 2020
- Posted by: Editor
- Category: Uncategorized
A single-family home is becoming the most sought-after type of home in the world. You might think that only home-buyers go after this type of property. But renters, in fact, are attracted to single family homes as well. With the increasing population and a generally growing affordability issue, the demand for single-family rentals is unlikely to die off any time soon. This means that this is a type of investment property that real estate investors should really consider.
We’ll be taking a look at the advantages and disadvantages of this type of real estate investment today to help you decide if single family properties are right for you.
What Is a Single-Family Home?
A single-family home, as the name suggests, is simply one unit that houses one family. This type of home is not connected to other residential structures. In other words, it is detached and sitting on its own parcel of land.
The Advantages and Disadvantages of a Single-Family Home.
We have already seen some advantages such as privacy, no shared walls or floors, fast appreciation, and a lower vacancy rate. Here are a few other benefits of investing in single family homes:
- More space – Besides space in the front and back yard, single family properties are also likely to come with basement space, attic space, and garage space. This is a plus for potential renters, especially now, in the time of COVID-19.
- Diversification – Owning multiple single-family homes allows you to invest across different neighbourhoods. This is a good strategy for minimizing risk – if one neighbourhood finds itself in a downturn, you can still make profits with the other single-family homes in the other neighbourhoods.
- Less maintenance –Single family properties have fewer fixtures and appliances compared to a multiple family dwelling. This means maintenance is less time-consuming and expensive.
- Cash flow– While it’s true that multi-family homes can earn more cash flow, that’s not to say that single family homes aren’t also cash flow properties. Single-family homes also bring more cash flow.
Although single family homes make for great real estate investments, they do come with some disadvantages. Owning a single-family home also comes with its share of downsides:
- Vacancy means no rental income – When someone moves out of an apartment, the landlord will still have some income coming from other units. However, a vacancy in a single family means there will be no income until a new tenant is found.
- Higher price– Single-family homes for sale are usually more expensive compared to multi-family properties (when looking at the cost per unit). However, you can find a great deal using Bricks & Tierra.
A single-family property is a great investment. Whether you choose to make it your first real estate investment or decide to buy a few single-family units to diversify your portfolio, be sure to use Bricks & Tierra to conduct your search and analysis.