Los Angeles is an extremely competitive real estate market, and if you’re just getting started or you’re wondering how to grow and diversify your existing portfolio, we encourage you to consider investing in multi-family properties.
Single-family homes can earn you reliable income and long-term appreciation. Multi-family rental property, however, offers less risk which typically translates to more money.
Multifamily properties in the Los Angeles rental market help you reduce your vacancy risk. They’re more cost-effective when it comes to maintenance and management. There are some excellent reasons to invest here, and we hope you’ll consider all of them when you’re looking for a new market and a larger portfolio.
Lower Purchase Price and Maintenance Costs per Investment Property
Multifamily properties and units in Los Angeles apartment buildings will have lower acquisition costs than they would if you were buying a single-family home. As an investor, this allows you to buy more with the money you’re willing to spend. Lenders may offer better rates on multi-family properties because you’ll be able to leverage your potential rental income. There’s also a lower risk of foreclosure and default, making lenders more comfortable with the money you’ll need to acquire the property.
If you have an apartment building with 15 units, getting maintenance work done on those properties is a lot easier, cheaper, and faster than it would be to dispatch maintenance teams to 15 separate single-family homes around the city of Los Angeles. Multi-family properties make more financial sense and provide better earning opportunities when it comes to preventative issues like pest control, roofing, HVAC servicing, and plumbing.
Lower Vacancy Risk with Los Angeles Multi-family Investments
When you own several multi-family properties or an apartment building, you’re bringing in rent from several different sources. That means when one property is vacant, the financial loss isn’t nearly as devastating as it is when you’re renting out a single-family home. You still have plenty of other income streams to cover that loss. You won’t find yourself without any income at all in a given month.
Growing Your Investment Portfolio
When you’re growing your Los Angeles real estate investment portfolio, investing in a multi-family property will move you closer to your goals than a single-family home. You’re able to bring in a handful of properties rather than just one. This gives your entire portfolio some diversity as well as extra strength.
Most investors hold their multi-family rental property for about five years. Maybe you have a 10 or 15-year investment plan and you’ll hold onto the assets a bit longer, but most of the investors we work with don’t like to keep their money tied up in one property for too long. You can use the assets you own to conduct 1031 exchanges and keep your assets growing.
When you’re thinking about investing in a multi-family property in Los Angeles, we hope you’ll let us help. Our experience in Los Angeles property management can assist you with identifying opportunities, evaluating neighborhoods, and planning for maintenance, rent-ready upgrades, and renovations. We can let you know how much you’ll earn and how long it will take to find a great tenant. When you’re ready to move forward, or if you have any questions, contact us at EGL Properties.