Real estate investors, whether novice or pro, have multiple choices when determining where to place their investment dollars. Condos, beach houses, single family and apartment buildings are all possible 

investments and each has its own advantages. Yet for those who have yet to decide which provides the best opportunity, especially those who are “first timers,” let’s take a look at the advantages an apartment building provides.

 

As an investor, you can have the opportunity to provide the initial financing to acquire and refurbish an apartment building. The returns on these private notes are significantly higher than other types of investments and because the investment is real estate, your note is secured by the collateral. When a developer approaches you with an opportunity, you have the ability to review the plans, returns and cash flow before making your decision.

You may also invest in multi-family buildings by being an owner of one, two or even all of the units within a project. When you invest in multi-family, you’re investing in an area with strong rental demand which translates into a lower vacancy rate. Your cash flow is protected when the units are almost always occupied. Apartment buildings also have property managers who will not only take care of any tenant issues but make maintenance calls when needed. Such property managers also market the property and show the property when a lease is about to expire. Further, as rental rates rise over time, you have the ability to raise rates to match market rents for the area.