There are tons of articles, courses, bootcamps, and forum posts related to flipping single family homes both on BiggerPockets and all sorts of other websites. For many people it makes complete sense.
Most families want to live the American Dream. They want to buy a 3BR/2BA house (or 5BR/6BA McMansion) in a beautiful neighborhood, move in with their 2.3 kids (average for statistical purposes – I am not advocating having 0.3 of a kid), and gradually pay off their mortgage (or walk away from the house when they get tired of paying).
With such a big market for single family homes, it is natural for all the rehabbers and flippers out there to cater to this large demographic.
But let me propose an alternative. In today’s economy, it seems like fewer and fewer people (although there are still a lot of them out there) are interested in ‘the American Dream’. I think there are a couple of reasons for this:
- Many people have been burned in the past couple of years by buying homes that proceeded to sink in value dramatically
- People have a hard time believing a home is their ‘best investment’ and are starting to see primary residences as liabilities more than assets
- The work force is becoming much more mobile thanks to technology. They like the flexibility of renting
- Younger workers have ever-increasing college debt loads that make them uneasy about taking on more debt like mortgages
Admittedly many of these observations are my own personal viewpoint from reading the news, but I am seeing it in my rental business and talking to friends and co-workers as well.
These same reasons though, provide a great market for people to buy residential multifamily properties.
Why Flip Small Multifamily Properties
If …read more