Debunking Myths About Multifamily Real Estate Investing
The real estate industry is the target of many myths. Most overstate the resources needed by investors, while others downplay the growth opportunities in the industry. All prevent potential investors from assessing whether real estate is a suitable investment.
Multifamily Investments, for one, can be perceived as expensive and labor-intensive when it offers greater access to promising real estate without the full price and burden of property management.
Let's review some of the most popular myths on real estate to help you differentiate facts from fiction.
Myth #1: Only the “rich” can invest in multifamily real estate.
Our response: You don’t need a million dollars to put in a property.
Although you will need a starting capital to invest, you don’t need a million dollars to put in a property. You can choose to invest depending on your comfort level. The beauty of multifamily is it allows you to join others in pooling the capital for a property. Through the joint venture, you can invest in more attractive real estate and enjoy economies of scale in the property upkeep. Multifamily is a widely known investment vehicle, so financing and processing documents should be relatively painless.
Myth #2: Real Estate is too risky.
Our Answer: Real estate is a comparably safe investment as it retains its value over time.
In fact, cash flow is one of the strengths of multifamily investments. You can expect monthly income from multiple tenants, guaranteeing continuous income even in the face of delinquency. Rental property also fares well, even in more challenging times. This is simply because the demand for affordable housing will always be there, maybe even more, as the cost of living rises.
Other promising attributes like depreciation & tax efficiency also help offset any risks related to real estate investment.
Myth #3: You need to be an ‘expert’ to invest
Our Answer: Investors start from different places.
That said, the lack of experience should not stop you from investing. Get curious, read materials on multifamily investments, and learn from real estate experts. Complement your research by attending webinars and other knowledge-sharing events. Through this, you can raise your questions and discuss available investment opportunities.
Makaan holds free webinars on multifamily, so make sure to follow us on Facebook & LinkedIn for updates.
Myth #4: Investing can be a full-time job
Our Answer: It can be, BUT you can also achieve great returns with passive investments.
Investors can entrust their multifamily investment to general partners who can look after the profitability and growth of their initial capital. In funding these units, they join other investors who benefit from syndication and the full benefits of passive investments.
Learn more about the difference between active and passive multifamily investments on this page.
Myth #5: Maintaining properties is too expensive to make a profit.
Our Answer: Multifamily is a great place to start building wealth.
With the right team and strategy, you can grow your investment from one property to the next, all while enjoying tax benefits. The difference lies in how your team will optimize the property, generate cost savings and explore value-add opportunities.
That’s why finding the right partners in your investment is just as important. If you’re looking for multifamily investment in Houston, Texas, then you are in the right place. Reach out to our team from Makaan Investment Group to identify passive income investment opportunities that can help you achieve your goals.