Multifamily Properties are buildings with more than one separate living unit. They can range from duplexes, triplexes and fourplexes to much larger apartment buildings. Buyers are usually interested in them for the rental income, the potential to improve the property over time, or a combination of both. Because the value of an income-producing Multifamily Property is closely tied to the income it generates, renovations that improve the units and support higher rents can also affect the property’s value.
Financing a multifamily investment can be quite different from financing a conventional home. Depending on the property, a lender may consider rental income, operating expenses, debt-service coverage, the condition and value of the building, and the buyer’s overall financial position. In some cases, the rental income can make a meaningful difference to how much a buyer is able to finance. Check the searches below for Multifamily BC properties for sale in Metro Vancouver and the Fraser Valley.
Multifamily Properties are designed to accommodate more than one household, with separate living spaces for each unit. The buildings themselves can be quite different in size and layout.
- Duplexes, triplexes and fourplexes are among the smaller forms of multifamily housing and can be a practical starting point for buyers who want more than one rental unit.
- Apartment buildings are larger Multifamily Properties and are generally evaluated more heavily on their income, expenses and overall operating performance.
A multifamily home may be completely updated or it may need significant work. Before buying, look closely at the roof, structure, plumbing, electrical, heating and other major systems. A property with strong rental income can still become expensive very quickly if major repairs have been deferred.
Multifamily homes are also often sold with existing tenants in place. Buyers need to review the tenancy information carefully and understand the existing rental agreements before completing the purchase.
Some investors choose to live in one unit and rent the others, using the rental income to offset part of their housing costs. Others buy the property strictly as an investment and focus on cash flow, long-term value and opportunities to improve the building.
Demand for rental housing is one reason investors continue to look at multifamily property in Greater Vancouver and the Fraser Valley. The numbers still need to work on the individual property, so rental income, expenses, financing, condition and future improvements should all be considered together rather than relying on the idea that multifamily real estate is automatically a good investment.
Learn more about buying investment properties on our Real Estate Investing page.
