Right now, local experts are estimating $500 Million in multi-family sales in 2011 compared to $150 Million in 2010. That's a huge jump. Why?
Here are 2 reasons why I think this is happening in our area (and will probably continue over the next few years):
- Rentals are performing very well right now with no end in sight; this is due to the uncertainty in the economy. When people aren't buying, they're renting. Higher demand for rentals causes rental rates to rise.
- You don't just get 1 set of tenants in a multi-family property, you get a few. With home prices being as low as they are right now, the Cash Flow ROI is almost always going to be higher today on a multi-family than on a single family. That is, if you buy the right one.