Benefits of Contemporary Multi-Family Architecture
Real estate is generally regarded as a solid investment. As long as the property is properly maintained, it stands to provide a positive return. There are a variety of different forms of architecture that each hold their own potential for providing returns. And these potential returns are not all the same.
Contemporary multi-family architecture can take a number of different forms. At its core, multi-family architecture refers to any structure — or series of structures on a singular property — that provides multiple, separate housing units.
A classic example of this could be an apartment complex or condos. However, Nashville has seen the emergence of another popular form of contemporary multi-family architecture which has come to be known as the “tall and skinny.”
But no matter what type of multi-family building you are considering, there are unique benefits that can be gained.
Here are the benefits of contemporary multi-family architecture:
- Potential for Large Returns
- Centralized Management
- Opportunities to Reduce Risk
- Popular Housing Option
- Potential for Appreciation
- Optimized Loan Potential
1. Potential for Large Returns
Contemporary multi-family architecture creates many opportunities for those looking for housing. The size of the property will dictate how much of an asset this can be.
It’s a simple fact of investing that larger properties will necessitate more money upfront. However, more units also means there are more opportunities to provide a larger return.
Tenants are secured through leases which guarantees a certain amount of continuous income. And as long as the property is properly managed, this source of income can be near-constant. A popular multi-family property provides numerous opportunities to increase your continued return.
2. Centralized Management
Managing a property takes a lot of attention and care. There are often many different tasks and responsibilities that need to be managed at a particular time. This requires the ability to multitask and prioritize duties.
This can be difficult if the property manager needs to spread their attention between multiple properties.
A multi-family property allows a manager to oversee multiple units while remaining in one location. Think of an apartment complex with twenty units. The manager is able to oversee the needs of all twenty tenants without leaving the building. Overseeing the same amount of tenants spread throughout multiple properties would require a much larger effort.
The ability to remain in one location allows the property manager to properly perform their duties which also benefits the tenants.
3. Opportunities to Reduce Risk
An empty unit is a drain on resources for a property investor. Each unit is priced in a way that, when combined, will cover the projected costs of operation and provide a positive return. Empty units reduce the ability to meet these goals.
However, multiple units help absorb the negative effects of an empty unit.
A property with a single, empty unit is nothing but a liability. However, the loss from a single, empty unit in a building with 99 other units is much easier to absorb.
More units not only provides a higher potential for return, it also reduces the risk associated with inevitable turnover.
4. Popular Housing Option
Contemporary multi-family architecture is very popular in Nashville and other large markets. Many people are becoming increasingly likely to continue renting property as opposed to buying a house.
This gives them the ability to keep their overhead costs low while still living in an attractive environment that is maintained without needing to put in work on their own.
The popularity of multi-family units makes it a safe investment with a high potential for returns. And this trend doesn’t show any sign of stopping. In fact, as Nashville continues to grow, multi-family units will only increase in popularity.
5. Potential for Appreciation
Real estate is generally considered to be a safe investment. With few exceptions, you can count on property either holding its value or going up in value. And usually, it goes up in value.
This is especially true for properties that make use of contemporary multi-family architecture in Nashville. The continued demand along with the near-constant stream of people moving to the city ensures these units aren’t going to remain vacant.
Property values are appreciating at a higher rate in Nashville than the national average. And while we can’t tell the future, we believe this trend will continue.
6. Optimized Loan Potential
Banks are willing to approve loans for investment opportunities they deem to be a low risk. And for all the reasons listed above, banks are generally willing to work with investors to provide loans to get these projects off the ground.
Contemporary multi-family architecture has a great future here in Nashville. There are many reasons why it’s a great idea to break into the market. Working with a local architecture firm is the best way to get the ball rolling.