Why Multifamily Properties Make Great Investments

Financial professional Igor Zernitsky boasts close to two decades of experience in the finance and real estate industry. A former senior manager at Ernst and Young in New York, Igor Zernitsky currently serves as Chief Financial Officer of Property Resources Corporation (PRC). This real estate company focuses on multifamily properties, which are residential properties with two or more units. There are reasons why these assets, also known as apartment complexes, can be great investments.

For example, the returns derived from this type of property are the highest in the real estate sector, with research showing their annual returns at 9.75 percent. The risk associated with a multifamily property is relatively low, as some apartments are almost always being rented and generating some income.

The demand for rentals also remains strong. More people, especially millennials, are choosing to rent apartments rather than buy houses. And by increasing or decreasing the rental fees, it’s easier to respond to changing economic conditions. This flexibility is due to the one-year leases common with these properties compared to the five-year contracts on offices, retail, and other commercial properties.

Another advantage of investing in multifamily properties is the ease of obtaining financing compared to other real estate investments. Financial institutions know they can get their money back through the multiple rental incomes from these properties, making them more lucrative than single-occupant properties. Multifamily investing is also much less volatile than other commercial real estate types.