Multifamily: The Basics
Housing will continue to go for a premium – people will always need somewhere to live, and every year more and more adults enter the housing market. Renting has increased in desirability due to the economic crises of the past decade. Younger generations buying houses is at an all-time low, and many older generations (empty nesters) are selling their homes and re-entering the rental market.
This is where you come in!
Unless your passion is particularly in housing, you most likely are in the business of real estate to earn money – specifically, a healthy passive income after an initial investment. Multifamily housing is an excellent way to begin investing in real estate!
What is a Multifamily Property?
Multifamily properties are exactly what they sound like – individual units that are either in the same building or that share walls. These units are occupied by different tenants/families. Hence, multi-family properties.
This is everything from a duplex, to condos, to high-rise apartments. (Keep in mind that, legally, these are not all treated the same – we’ll get to that!)
Examples of other multifamily property types are:
- triplexes, fourplexes
- bungalow courts
- townhouses, garden apartments
- multistory apartment buildings
Local & Federal Governance - Fair Housing Act and the Americans With Disabilities Act:
The Federal Fair Housing Act leaves very few exemptions for property management, but one such exclusion is that apartments of four units or less are exempt if the owner lives in one of the units.
Commercial Real Estate Properties (offices, warehouse & other non-residential buildings) must be more concerned with the ADA than the FHA, as the FHA concerns residential properties. However, multifamily properties must be well-versed in both the FHA & the ADA. While the bulk of business comes from residential income (therefore regulated by the FHA), public access areas, like lobbies, gyms, swimming pools, or leasing offices, must be ADA compliant.
Why Do Renters Choose Multifamily Properties?
Multifamily is playing a key part of urban infrastructure development! As suburban sprawl spreads outwards, for multifamily units in urban areas like DFW, the sky is literally the limit! Multifamily units ability to build housing upwards creates homes in areas that younger generations want to live in!
We’ve discussed before that Millennials and Gen Z are the fastest-growing rental population. The priorities of these financially-pressed generations focus on convenience, accessibility to social gathering places, affordability, and management values that acknowledge and reflect their own. Multifamily is flexible enough to accommodate these demands.
For empty-nesters and retirees, a multifamily setting is a reduced workload from the continuing maintenance of home ownership. Multifamily properties take on the burden of repairs and maintenance for older renters who would much rather spend their golden years relaxing!
Multifamily properties continue to be in demand, and will certainly grow as the population does! Management of these properties is a unique challenge for a landlord. Everything from applications to tenant issues, multiplied by the number of units that you manage – it can be quite the task! An experienced Property Management team like Frontline Property Management can help you assess your goals, manage your tenants and take the legwork (and guesswork!) out managing your multifamily properties!
Contact us today for more information about how we manage thousands of doors in the Dallas-Fort Worth area!