- Listing ID: cx_234141
- Broker Name: Laurence Bergman
- Broker License: KY 47790, OH 000348029,
- Phone Number: 513.322.6307
- Square Feet: 45,660
Apartment buildings, complexes, and townhouses are all popular real estate investments. These properties house multiple families and include common areas and amenities. Although there are slight differences between each property type:
Types of Apartment Buildings
Apartment Building: Typically consists of one building with various rental units inside, the landlord is responsible for all maintenance costs of apartment buildings. The apartment units themselves may feature different floorplans including everything from tiny studio apartments to larger apartments with several bedrooms.
Apartment Complex: An apartment complex is almost the same as an apartment building. However, a complex may include several buildings and feature courtyards, pools and other amenities between the buildings.
Townhouse: Townhouses are usually small individual homes that often share walls with the neighbors. Generally, each unit will have a separate owner, but maintenance and the upkeep costs of common areas are shared among the owners. Usually, landlords aren’t responsible for maintenance costs related to townhouses.
Buying Apartment Buildings: Making A Smart Investment
Are you looking for an almost passive income that drops into your lap each month? Well, then purchasing an apartment building can be a great investment that provides great income with relatively little effort on your part. However, whether you’re dipping your toes into the world of real estate or you’re an experienced building owner, you still need to make your decision about purchasing townhouses or an apartment building with care. When buying an apartment complex, here are some of the key factors that you should keep in mind to make sure you don’t regret your investment:
Location: The location of your apartment building is key. First, look for a city with a low unemployment rate, as it can help to ensure that you’ll always have paying tenants. Also, a space with close proximity to a university, a commercial center, a grocery store, or a beautiful park can help make your property more appealing.
If you purchase in an economically depressed area of town, your initial investment may be low, but it might be hard to fill your apartments. On the other hand, purchasing apartment buildings in affluent areas can present you with a considerable investment. Therefore, we recommend choosing an area that seems to be growing in popularity so you can enjoy a reasonable purchase price and the subsequent increase in rental rates.
Performance: Before purchasing an apartment building, you should discover how the property is performing financially right now. Thus, you should request all of the applicable financial documents so that you can analyze the situation and ensure you pay a fair purchase price.
Improvements: Many investors purchase a low-value property and hope to fix it up to improve marketability. However, it’s important to know how much more you’ll have to invest and exactly how the improvements will affect rent payments or the overall property value. You can predict your own income by checking competitor’s rental fees.
Laws and Regulations: Some cities and areas have regulations on rent costs, townhouse dues, eviction processes, and more. All of these regulations can affect your ability to earn an income, so know the rules ahead of time so that you can evaluate the financial implications they may have on your investment.
Maintenance Costs: Owning an apartment building comes with maintenance costs. In addition to building upkeep cost, you may also be responsible for mowing the lawn or maintaining a parking lot. However, if you invest in townhouses, the owners would be responsible for these costs. So, being aware and understand these costs, as well as comparing them against your building’s income will help you decide whether buying an apartment building will be profitable.
The current trends, especially the increasing demand for apartments in big cities, make apartment buildings and townhouses a lucrative investment. However, the returns are highly dependent on making a wise decision, by taking the above considerations into account.