007 St. Louis SIngleFam vs MultiFam as a rental investment

Multifamily vs. Single-Family Investments

Welcome to the Saint Louis Property Management Podcast, hosted by Derek Merkel and Anthony Zamacona, both experienced property managers and realtors at Avenue Real Estate Group. In this episode, they dive into an essential topic for real estate investors: the differences between multifamily and single-family investments. Whether you're a new investor or seasoned, this conversation offers valuable insights to help you decide which property type is best suited for your goals.

00:00:02 – Introduction
Derek and Anthony kick off the podcast with a warm welcome. They introduce themselves as realtors and property managers and set the stage for the day's discussion, focusing on multifamily vs. single-family investment strategies.

“Welcome to the Saint Louis Property Management Podcast. I’m Derek Merkel, and this is Anthony Zamacona.” – 00:00:03
00:00:14 – Setting the Topic: Multifamily vs. Single-Family
The hosts reveal the topic for today's episode and emphasize that they aren't here to declare one investment type better than the other. Instead, the conversation revolves around understanding the differences between multifamily and single-family properties and how these differences relate to an investor's unique goals.

“The topic for today’s podcast is multifamily versus single-family and which one is, I wouldn’t say better, but you know, the differences between them.” – 00:00:18

00:00:29 – Determining Your Real Estate Goals
Derek and Anthony delve into how an investor’s specific goals and circumstances will play a significant role in choosing between these property types. They talk about the factors that influence an investor’s decision, including whether you’re just starting out or already an experienced investor.

“What your specific goals are with real estate will determine which one may be more beneficial for you to get into.” – 00:00:29
00:00:40 – Derek Prefers Multifamily, Anthony Prefers Single-Family
Both hosts reveal their preferences: Derek gravitates toward multifamily investments, while Anthony is a fan of single-family homes. This sets the stage for a friendly debate where both sides will share their perspectives, backed by real-world experience.

“I’m kind of on the multifamily side, and Anthony is a little bit more on the single-family side.” – 00:00:40

00:00:49 – What Attracts Anthony to Single-Family Investments
Anthony begins by outlining what excites him about single-family homes. He breaks down how he evaluates deals and looks at investment properties that come across his desk. He considers important factors like leasing, property management, and what challenges each type of property presents.

“When I look at these investment deals, whether it’s multifamily or single-family, I’m looking at the leasing and management side.” – 00:00:52

00:01:02 – Maintenance Differences: Single-Family vs. Multifamily
As the conversation continues, Anthony highlights the maintenance challenges that differ significantly between the two property types. The nature and cost of maintaining a multifamily property can be quite different from a single-family home, which is an important consideration for potential investors.

“There’s a big difference in maintenance between single-family and multifamily properties.” – 00:01:10

Key Takeaways for Investors
Throughout the episode, Derek and Anthony provide a balanced, well-rounded look at the pros and cons of investing in multifamily vs. single-family properties. They emphasize that there is no one-size-fits-all answer; rather, the right choice depends on the investor’s goals, experience, and risk tolerance.

Multifamily Investments (Derek's Perspective):

Pros:
Typically generate higher cash flow due to multiple tenants.
Spread out the risk, as vacancies in one unit don’t necessarily mean a total loss of income.
More streamlined management with multiple units under one roof.
Cons:
Higher upfront costs.
More complex management and maintenance needs.
Potentially more challenging to finance, especially for beginners.
Single-Family Investments (Anthony's Perspective):

Pros:
Easier to manage, especially for new investors.
Lower maintenance costs per unit.
Easier to sell or liquidate if needed, as single-family homes tend to have a larger buyer pool.
Cons:
Limited to one tenant per property, which means if the tenant moves out, there is zero cash flow.
Can be more challenging to scale as an investment portfolio compared to multifamily properties.
Final Thoughts: How to Choose?
By the end of the podcast, both hosts agree that the choice between multifamily and single-family investments depends on the investor’s goals. For those looking for higher cash flow and who are comfortable with the complexities of managing multiple tenants, multifamily might be the better choice. On the other hand, investors who prefer lower maintenance and easier liquidation might find single-family homes to be more attractive.