Multifamily Financing for Beginners in Investment

real estate assets

If you want to diversify your real estate assets, multifamily real estate investing can make your portfolio receive amazing returns. Real estate investors are still mostly interested in single-family homes. Starting with multifamily house investments, on the other hand, can provide a stable rental income while also teaching you the fundamentals of real estate investing, such as acquisition, refurbishment, and sale. Multifamily real estate, as the name implies, consists of residential properties with many housing units. Multifamily dwellings are home arrangements that fulfill the descriptions of duplexes, apartment complexes, condos, and townhomes. A multifamily residence is typically made up of an owner/investor who lives in one unit and rents or sells the rest. Multifamily home investments may appeal to newcomers to the market as a fresh way to gain capital appreciation.

Three helpful tips for getting started with multifamily investing –

Building a portfolio with one or more multifamily properties, followed by single-family housing units, is both gratifying and educational. If you don’t want to limit yourself to single-family assets, multifamily real estate is a good option. When beginning off with such investments, keep the following in mind:

Calculate your Net Operating Income (NOI)

The easiest way to sift the most profitable multifamily asset deals out of all the possibilities on the table is to calculate Net Operating Income. Investing in a multifamily asset can provide you with predictable income streams from rental fees, storage fees, parking fees, and other sources, as well as predictable expenses like repairs and maintenance. If you don’t have access to local comp numbers, you can use the 50 percent rule to determine which trade is the most profitable of all the possibilities. The 50 percent rule states that you should split your expected revenue and use it as a rough guide to your planned expenses.

Cash Flow Calculation

Calculate how much you can pay off in monthly mortgage payments by taking into consideration your projected monthly cash flow. To calculate the Cash Flow, subtract the monthly mortgage from the Net Operating Income. You can analyze the viability of any multifamily asset deal after you have an approximate cash flow figure.

Capitalization Rate Inference

Finally, you must determine the Capitalization Rate. The capitalization rate, often known as the cap rate, is a crucial deciding factor in every purchase because it determines how quickly you will receive your return on investment. The Cap Rate is a metric that can be used to judge if an investment is ‘safe’ or not; a safe Cap Rate number is between 1-2 percent. However, keep in mind that a low or safe cap rate implies low risk and poor profits, whereas a high cap rate implies the opposite. To get an exact Cap Rate, multiply your Net Operating Income by twelve and divide it by the current market value of the property. A multifamily asset with a Cap Rate of 5-1 percent mitigates risk while simultaneously delivering a much larger return than a ‘certainly safe’ Cap Rate Value.

6 Reasons the DFW Market is Booming

The Dallas housing market has recovered from pandemic blows since July of the pandemic year. Since the second half of 2020, demand for single-family houses has increased while supply has lagged. Dallas is one of the most recognizable and buzzworthy metropolitan areas in the U.S. if not the world. Fortunately, despite its growing popularity and rapid expansion, Dallas remains a market with plenty of room for growth. According to the Texas REALTORS® 2021 Texas Real Estate Year in Review report, the volume of Texas house sales and the median price achieved all-time highs for the seventh consecutive year.

We observed numerous multiple-offer situations, including homes that received dozens of offers and sold for substantially more than the asking price, as housing demand reached an all-time high. The number of homes sold statewide increased by 6.2 percent to 416,853 units in 2021. The median home price increased by 15.7 percent from the previous year to $300,000. The $150 median price per square foot represents a 16.9% rise from 2020 and a 35.6 percent increase from 2017. Homes stayed on the market for an average of 34 days, which is 21 days shorter than in 2020. These numbers are indicating the high demand for homes but a lower supply, meaning Dallas is a hot hub for investors to put their money.

 Here are a few strong reasons why Dallas could be an excellent location for your next rental.

The Population growth

Dallas-Fort Worth continues to grow in population, and it is currently the country’s fourth-largest metro region, up from the sixth position in 2010. In fact, along with Houston and NYC, DFW was one of only three metros to increase at least 1.2 million residents since 2010.

Occupational Market

While many other regions of the country are still recovering, Dallas remains a job centre. DFW is, in reality, the nation’s top job market, thanks to strong job growth and in-migration. According to The Dallas Morning News, top leading labour indices such as net migration, college degree holders, and employment gains and growth rank Dallas high.

The Real Estate Market

The National Association of Realtors (NAR) has named Dallas as one of the top ten markets to watch in a post-pandemic world in 2021-2022. It’s easy to see why when you look at recent housing figures. According to the Texas Real Estate Research Center’s most current report (November 2021), single-family house prices climbed by almost 18% year over year, while months inventory decreased from 1.3 to 1.0 months.

Desirable Market for Renters’

Most Dallas communities are seeing growing home prices, making it one of North Texas’ hottest housing markets. Low mortgage rates and a frenzied demand from in-state purchasers and out-of-state real estate investors, according to the Dallas News, have pushed property prices up by 50% in some of Dallas’ most popular neighborhoods. Demand for rental property in Dallas could continue strong in 2022, thanks to high home prices, a growing population, and a healthy employment market, to name a few factors.

Living Standards

Dallas real estate prices are still surprisingly low, the job economy is strong, the cost of living is reasonable, and the city has a vibrant cultural scene. When you consider that TX has no state income or inheritance taxes, it’s simple to see why so many people and businesses are relocating to Dallas.

Dallas’ Strong Economy

Investing in Dallas real estate is the best move for investors because the city’s economy is so broad that it caters to people of all economic levels. Every day, an estimated 340 people relocate to Dallas-Fort Worth. Renting is more inexpensive than buying in Dallas, which has the lowest homeownership rate in the country.

Dallas is a major employment centre. New jobs have fueled a land rush in North Texas, making it one of the fastest-growing regions in the country. In 2018, 102,500 new jobs were generated, and approximately 130,000 people relocated to the city. The city is a prominent financial hub in the South of the United States, and it is home to a huge number of company headquarters.

The aerospace, computer chips, telecommunications, transportation, energy, and healthcare sectors, as well as Finance and Business Services, make up Dallas’ local economy. All of these industries pay well, resulting in a robust market for Dallas investment properties.

Furthermore, 15 large IT businesses have relocated to Dallas, Texas since 2014, delivering innovation and job growth in the industrial and professional sectors. These elements all contribute to the Dallas real estate market’s explosive rise. In Dallas, Texas, tourism is on the rise, resulting throughout job growth in the city’s cities and neighborhoods.

 

Conclusion:

With a strong and vibrant economy, growing population and affordable cost of living, Dallas is experiencing an increase in demand for housing. As a result, property values have been steadily increasing. As a result, buying real estate in Dallas is one of the best investments you can make this year. For more information contact us: www.saharaequity.com

5 Reasons to Invest in Land Development/ New Construction

Newly built homes can be an excellent investment, particularly for landlords who want to avoid the constant care and repairs that come with older homes. Real estate investors’ primary goal is to find a property that generates a reasonable return on their investment. In an up-and-coming neighbourhood with significant rental demand, a new build investment property can yield exceptional profits.

 
BENEFITS OF BUYING NEW CONSTRUCTION INVESTMENT PROPERTY

 

Appreciation & Instant Equity                             

New construction homes are a good strategy for investors looking for growth. Investing in new and emerging areas can boost the rate of appreciation of your property and help you build equity faster. Because appreciation is never guaranteed, conduct a competitive market analysis before purchasing. You may be confident that your home will appreciate it if you know the market is growing and there is considerable rental demand.

Discounts

In some cases, purchasing new construction from a builder early in the development process might provide you with early bird prices or large discounts. It is not uncommon to buy property from a builder for a discount of 5% to 20% below market value. Why would a builder sell you a home at a reduced price? One reason is that they want to keep their sales high and their debts low so they can get lender funding to build additional property. Having buyers lined up to buy the builder’s product minimizes the risk of the lender providing that builder with a loan. Customization and Cost Control When you buy a pre-construction home, you get the added benefit of being able to modify it to your specifications. The ability to choose various aspects such as flooring, cabinetry, lighting, plumbing, and fixtures is an obvious advantage of purchasing a pre-construction house. When you want to keep your costs low while keeping it as durable and desirable to future tenants as possible, this is a good option. In most new subdivisions, you can even choose the location of your lot.

Newer Technology

 In comparison to resale buildings, new construction properties have better construction and more modern, longer-lasting building materials. Insulation technology has advanced significantly in recent years, resulting in increased comfort and energy efficiency. Furthermore, indoor air quality has greatly improved as a result of advancements in heating and air conditioning systems.

People Like Living in New Homes

We have a remarkable ability to adapt to our circumstances as humans. For example, a squeaky ceiling fan may initially drive you insane, but after a while, you don’t even notice it. We grow bored easily because we become accustomed to our surroundings. The majority of us enjoy flashy, new items. Why do you believe so many individuals opt to lease their cars? For many people, the joy of driving down the street in a brand-new car every two or three years surpasses the cost. When the “new car feeling” wears off, they might start looking for their next lease automobile and repeat the process. New construction homes have a cleaner feel to them and often have open floor plans.

Growth and Emerging Markets 

In growth and emerging markets, there is constantly new construction. As a real estate investor, this is where you want to put your money to minimize risk and maximize long-term growth. You could invest in resale property in these same growth markets, but you’d miss out on the other advantages discussed in this article. As always, do your homework and examine the markets you’re contemplating. Purchasing new property in places where work, shopping, and other vital amenities are a long travel away may put you too far ahead of the curve, reducing the rental potential of your investment.

Conclusion

Overall, freshly developed real estate is better suited as investment property than resale residences. Simply put, they are more energy-efficient, healthier, and require less upkeep. They can be purchased in emerging countries with minimal initial payments and frequently at a discount to market value. There are no surprises, which means less anxiety and stress for you.

New to Real Estate Investing? Here are some tips!

Congratulations if you’re a first-time real estate investor! It’s a great opportunity to enter this industry. There are several tactics to consider and paths to take. It might feel a little daunting at first, but don’t worry; we’ve got your back. We’ll go over seven beginner-friendly ideas and methods in this blog article to assist you get started in the world of real estate investment.

Begin with a Small Amount of Money

Beginner real-estate investment advice advises against going all-in right away. Real estate investments may easily go wrong, and you don’t want to be undercapitalized. Instead, begin by putting a tiny percentage of your available assets into your portfolio to evaluate how things operate before taking on additional risk. Consider putting up higher sums of money once you’ve gained confidence in yourself as an investor. This will help you build up your foundation faster. Until then, stick to what works best for newbie’s: modest real estate transactions.

Understanding the Market

The first step for new investors is to determine what their local real estate market requires. Beginner investors should be aware of the following:

  1. What are the most popular sorts of properties?
  2. How long will they be on the market?
  3. In your area, what are the prices of similar properties?

Stay Patient 

Purchasing a home is a lengthy process, with the majority of actual property transactions requiring a few days to complete. While a lot of real estate businesses claim to be able to fulfill procedures in as little as 24 hours, the reality remains that patience might help you get a good deal. Jumping the gun may result in you paying more for the property or purchasing one that falls short of your expectations. Sellers can also postpone projects, which may result in your investment not yielding any rewards for a period of time, testing your patience.

Research the Property

Today, doing your study before going out to seek for a home is crucial. With so many projects coming up, it might be difficult to find the correct real estate, especially because sellers are notorious for sweet-talking buyers. The facilities available, the building company’s history, the materials utilized, and the location of a home may all influence the returns you receive on your investment. If you don’t do your homework before buying something, you can end yourself regretting it later, resulting in a loss of money.

Check the Papers 

The papers of a property are likely the most critical element to examine, since someone unfamiliar with the real estate sector may be duped into purchasing a home with forged documents. Purchasing a property with unclear titles might result in lengthy legal battles or litigation, thus nullifying the investment. All property paperwork should be authenticated by legal specialists, since failing to do so might result in you acquiring a property that is entangled in difficulty. People frequently sell homes below market value, which should raise your suspicions since such properties may be involved in litigation or have internal concerns with the owner.

Check Market Rates

 The majority of local governments give a guiding value to assist investors in determining a property’s rate. Knowing the market rate will help you keep track of local trends and avoid being duped into buying more for a property than it is worth. Researching market rates and analyzing trends might assist you in extrapolating future profits.

Talk To Neighbours 

Speaking with your neighbours is a fantastic notion that most of us overlook. This may help you get a firsthand look into how things are in a certain location, allowing you to pinpoint any issues or places that could dilute an investment. Talking to them may also help you learn about current market prices and how the region has evolved, as well as the potential for future growth. Given that your neighbours aren’t salespeople attempting to sell you a house, you can receive a good image of the property you want to buy.

Remain Positive

 It’s critical to have a good attitude when completing a real estate transaction, since there will always be instances when things don’t go as planned. When dealing with property sellers, staying calm and composed will help you obtain additional benefits.

Calculate Your Finances

 It is critical to analyze your financial resources in order to ensure that you accomplish specific objectives. While getting a loan from a bank is simple, calculating the interest and other aspects is essential.

Is it really beneficial to invest post-COVID?

COVID affected investments

The acquisition of a property for the aim of ownership or profit is referred to as property investment. This can be accomplished by either upgrading and selling the property or renting it out. This is frequently seen to be quite profitable. However, as a result of COVID-19’s impact on the global economy, various businesses and sectors is suffering uncertainty about the future.

If you’re thinking about investing in real estate but aren’t sure, you may rest certain that real estate will remain a secure bet after COVID-19. Understanding the many components that contribute to this might help provide clarity to the situation.

Increased number of buyers and investors

The economy has taken a blow during COVID-19, and with businesses all over the place being disrupted, stock prices have plummeted. Because prices are at an all-time low and property investment is more accessible, this has resulted in a rise in the number of investments. Furthermore, during COVID-19, the number of homebuyers has not decreased. People have continued to buy rental properties for sale, particularly ready-to-move-in flats. This tendency is expected to continue in the coming months when the lockdown is removed in other places. This is due to the fact that the economy will take time to recover. Interest rates and prices will stay low in order to maintain consumer demand in the market after COVID-19. These favorable circumstances will make property investment a top priority, especially because aggressive negotiations will be feasible.

Long term assets

Diseases and recessions have afflicted the world in the past, but it has always managed to recover.. Long-term investors should not be concerned about market volatility because it is just transitory. Furthermore, any investor understands that long-term investments, such as commercial property investment, are preferable than short-term investments since they yield better returns. For this reason, investing in rental property will continue to be profitable even after COVID-19.

Uncertainty prompts action

Many people have suffered uncertainty about important areas of their life as a result of the lockdown and epidemic. Some have been concerned about their job stability, while others have been concerned about living in leased housing. As a result, concerns about occupation vs. ownership have arisen. However, many people have realized the value of real estate investing as a source of income as well as a safe haven. Purchasing and leasing a rental property may provide a constant source of income, making it a viable investment. In comparison to rental agreements, property investments provide more stability in terms of living arrangements.

Appreciation of real estate

Real estate appreciates in value over time, and the highest real estate investment returns come from well-maintained and cared-for properties. Redecorating the house can take this a step further. Interior design patterns are continuously changing, and the appearance and feel of a house influence how much tenants or purchasers value it. As a result, purchasing a rental property does not have to end there – upgrading the home may assist raise the value of any property.

An assurance from the government

The real estate industry is critical to the economy and public wellbeing. As a result, governments may intervene with specific measures to assist fuel growth. When the real estate market isn’t operating well, governments may give subsidies or assistance. One example is the tax advantages that first-time home purchasers might take advantage of.

All of these factors indicate that real estate is a secure investment option that will remain such after COVID-19. If you’re seeking to invest in real estate in Texas, Sahara Equity has homes in the top neighborhoods in the state, where elegance and comfort are never sacrificed. To learn more, contact us immediately.

Invest in Real Estate, Invest in your Future!

Why Should You Start Investing in Real Estate Today?

Real estate investments made in the right place at the right time, deliver incredibly high returns compared to other investments. Compared to common investment options like stocks, mutual funds and bonds, investing in real estate is easier to learn. It is also a stable investment and more often than not, provides better returns than any other holding in the long run.

‘Do not put all your eggs in the same basket’ is a statement repeated all over the investment industry. As an investor trying to make their money do the work, real estate is a good option to diversify one’s portfolio. Here are some key benefits of investing in real estate.

 Five Reasons to Invest in Real Estate:

  1. To guarantee an increase in net worth and wealth over some time. Millions of people have become wealthy by investing in real estate.

  2. To receive tax benefits. You could be qualified to receive some tax benefits when investing in real estate like incentive programs, capital gains, and you can even deduct expenses.

  3. To have an asset that almost always guarantees to give returns higher than inflation.

  4. Real estate investments are for anyone who has sufficient capital and a heart to multiply that manifold. Studying real estate is not as complicated as studying stocks. It requires less training and technically there are no qualifications to be a real estate investor.

  5. Real estate investments despite being a stable alternative have the potential to match the returns from stock and other investments. According to netwallet.com, the average return on investment from the stock market in the United States is 10%. While mashvisor.com claims Real Estate Investment Trusts (REIT) to have delivered an average of 11.5% returns to its investors.  According to comparative data in millionacres.com, real estate investments can offer better returns than stocks as a long term holding, say over a decade or two.

  6. Real estate is regarded by experts as one of the best sources of passive income. Make the right real estate investments to multiply the money parked idly in your bank.

Types of Real Estate Investments

Real estate investors have multiple options to reap benefits. Everything real estate has value; investors can choose their preferred type according to their expectations, comfort and calculations. The different types of real estate investments are listed below.

Owning a Property

The most basic type of real estate investment is to directly buy a property. As the owner of the property, investors will benefit from the natural appreciation in value over time. If the newly invested property is in a state like Texas where there is a rapid increase in population, combined with a strong economy and great rate of job creation, then the value is likely to appreciate at a faster rate over time. Location is the most important factor when it comes to investing in properties, and a state like Texas is ideal for Real Estate investment.

Properties to invest in can be broadly classified into three types:

  1. Rental Properties: Owning a rental property is ideal for beginner investors with sufficient capital. The investors in rentable properties will get the double benefits of seeing their capital increase enormously with time due to appreciating Real Estate while also enjoying the cash flow offered by rental income.

  2. Utility Properties: These are properties that can offer alternate incomes like farmlands that offer revenue from farm produce if put to proper use or even a barren plot whose value can increase with developments within the vicinity.

  3. Flipping Houses: If one has the capital for initial investment, then flipping houses is one of the easiest ways to enhance wealth. The value of a house will increase naturally with time as the development and commercial value of the location and demand for homes increases. The value of a home can also be forcefully enhanced by investing in remodeling and repairs. This is an easy way to increase revenue and this also has good tax benefits.

The challenges of owning a property: It is always up to the landlord to maintain and manage the property. Signing rental agreements, providing bills for rents paid, overseeing the utilization of the property etc. can be unappealing to many people.

Owning a property also requires ready capital. The alternative will be to depend on bank loans with a long payback (of course the property’s rental income or utility would help in this front, yet this shall be uncomfortable for some).

Real Estate Investment Trusts

Real Estate Investment Trusts (REITs) are amongst the easiest options to invest in real estate. Many experts would normally suggest REITs for beginners in real estate, especially if they have experience in the stock market. REITs are real estate companies that own and manage a diverse portfolio of real estate. They are listed in the stock market and their shares are available like that of any other company listed. REITs require the least amount of capital investments. This is the best place to start for people who would like to test the waters before taking a plunge.

REITs are companies that own large apartment complexes, commercial buildings, medical facilities, data centres and other real estate holdings. They generate income through rent, sales, management and appreciation. An investor can buy shares in a REIT and generate income as dividends and price appreciation.

Real Estate Crowdfunding

Real estate crowdfunding is a concept that was introduced in 2012. Investing in a crowdfunding platform can bring high returns but also possess a significant risk factor. As the name suggests, Real estate crowdfunding is a platform where like-minded investors pool money to purchase, sell and manage properties. Most crowdfunding platforms are relatively new in the market and are untested in economic downturns. However, they have managed to stay afloat in the pandemic induced recession. Crowdfunding platforms connect investors to a real estate syndicate.

Real estate crowdfunding portals, even the ones that allow only accredited investors, are accessible for less capital than that of a real estate syndication firm. Crowdfunding investor relationships are temporary and change from project to project.

Real Estate Syndication

Real estate syndication firms are companies where like-minded investors can pool in their money and invest in properties which they wouldn’t have been able to afford individually. This equity-based partnership model is the best way to invest in real estate for beginners. Real estate syndication firms like the Texas-based Sahara Equity consist of experts who do a deep market study, follow development plans of the government, use expert data and techniques to ensure they choose the best properties which give incredibly high returns to all investors. Even with zero knowledge, one can partner and invest with such companies to enjoy the limitless returns which come with real estate. Investors in a syndicate are generally considered partners in a business and can have their limited say in the joint co-operation. 

 

Which is the best Real Estate Investment for a Beginner?

It all depends on the investor. 

Owning a property for rental revenue, utility or flipping can give an investor a sense of complete freedom. On the flip side, he/she will have to do all the groundwork required for the investment.

Investing in a REIT is more comfortable for investors who have successful previous experience in the stock market. Real Estate Investment Trusts depend on the overall industry atmosphere for delivering returns and that can be tricky. However, investors low on capital can start with REITs before they get into other real estate investment methods.

Real Estate Crowdfunding is attractive and can deliver good returns. In this system, the sponsor/management takes care of the background study. This is ideal for people with medium cash who want to invest in large scale real estate projects.

Investing in Real Estate Syndication firms is the best option for investors with sufficient capital. The investors become partners. Syndication firms tend to give incredible returns in the long term and can be relied upon because they only choose the best properties with the most potency for value appreciation.

 
real estate assets

Multifamily Financing for Beginners in Investment

If you want to diversify your real estate assets, multifamily real estate investing can make your portfolio receive amazing returns. Real estate investors are still mostly interested in single-family homes.
Read More

6 Reasons the DFW Market is Booming

The Dallas housing market has recovered from pandemic blows since July of the pandemic year. Since the second half of 2020, demand for single-family houses has increased while supply has
Read More

5 Reasons to Invest in Land Development/ New Construction

Newly built homes can be an excellent investment, particularly for landlords who want to avoid the constant care and repairs that come with older homes. Real estate investors’ primary goal
Read More

New to Real Estate Investing? Here are some tips!

Congratulations if you’re a first-time real estate investor! It’s a great opportunity to enter this industry. There are several tactics to consider and paths to take. It might feel a little daunting at first, but
Read More
COVID affected investments

Is it really beneficial to invest post-COVID?

The acquisition of a property for the aim of ownership or profit is referred to as property investment. This can be accomplished by either upgrading and selling the property or
Read More

Multifamily | Different Asset Classes

What is a Multifamily Real Estate Asset? Multifamily Real Estate assets are amongst the least risky real estate investments, which offer a steady return and passive income. In Texas, most
Read More

Multifamily | Different Asset Classes

What is a Multifamily Real Estate Asset?

Multifamily Real Estate assets are amongst the least risky real estate investments, which offer a steady return and passive income. In Texas, most multifamily properties are considered residential spaces, but others are commercial properties depending on the number of units. 

This type of real estate investment offers high tax benefits to the investors in addition to an almost guaranteed cash flow via rental income. Real estate investments also appreciate over time and on most occasions offer much more than profit through interest. According to listwithclever.com, in the last calendar year, we saw a 7.9% appreciation in the median value of apartments in Texas. This is expected to rise another 4.2% in 2021. Thus by all accounts, multifamily real estate is amongst the best alternative investment options for passive income in Texas.

Multifamily real estate properties are classified into four classes based on their location, amenities, year of build, rental income potential and value addition. These complexes are classified into four classes namely Class A, Class B, Class C and Class D. Of these the first three namely A, B and C class properties are most likely to attract investors.

Class A Properties

Class A properties are the newly constructed, top-class apartment complexes with all the necessary amenities. They normally contain dispensaries, well-laid parks, swimming pools, shopping zones, gyms, pet caretaking facilities, sufficient parking space, clubhouses and all top class amenities a potential tenant can ask for. Class A apartment complexes are located in the most desired localities with external amenities like schools, hospitals and major retail zones within the vicinity. Class A properties within cities or high-class suburbs can see an expanding job market.

At times Class A multifamily real estate properties do not offer much ‘in house’ amenities. These properties are likely to give the highest rental incomes and you can see good appreciation in the long run. Class A properties are also maintained properly with almost no wear and tear; usually less than 10 years old.

From an investor’s point of view, Class A properties are usually not affordable to the working class. These are luxury properties that are costly and also yield high rental revenue. The asset appreciation occurs at a higher rate in this category of multifamily properties.

Because the rent is generally on a higher note and this property class will be the most hit by a market crash or a recession. During times like the COVID-19 pandemic, rental revenues from Class A properties decreased the most compared to Class B or C. This shift was due to the lowered demand of high-class properties –making it harder to monetize this type of property.

Sahara Equity’s University Heights in Fort Worth, Texas is a classic example of a Class A property. This 117 unit complex comes with all amenities, including shopping, dining, fitness, and social activities.


Class B Properties

Class B multifamily real estate assets are classified under two different criteria. They are 

1) the year of build

2) the location

Class B multifamily real estate complexes are typically a little over 10 years old. These are well-maintained structures that require very little input costs for upgrading to Class A. The interiors in these properties are slightly outdated but not as vintage like Class C structures. They still have attractive flooring, kitchen and interiors. The external amenities in these complexes typically include basic things like grocery shops, parks and parking facilities.

Class B properties are most likely within a developing suburb, with families as potential tenants. These suburbs also appreciate the value of the Class B property if there is a strong community with amenities such as hospitals, universities and businesses. Investors normally invest in these properties for asset appreciation ahead of cash flow. 


Class C Properties

Class C multifamily real estate complex is normally an older structure that might be around 30 years old. The infrastructure including electrical lines, HVAC and telecommunications are outdated. They come with some vintage interiors. 

These properties typically have weaker structures and require a lot of initial capital investments for repair and remodeling. Yet this asset class is a real estate syndicator’s favorite because the value of such assets can easily be enhanced with some value addition and resold for a much better price. Class C multifamily real estate buildings provide the best cash flow for capitalists.

The Best Class of Property to Invest in Texas

The real estate market in Texas is re-emerging from the COVID-19 pandemic setback. Market experts are projecting a spike in prices in the coming years.

In an emerging market, it is advisable for investors who are looking at long term gains to opt for Class A properties that are likely to deliver short term rental revenue and a steady long term appreciation. However, investing in these properties require high initial input capital.

For investors who are short on budget but love to have a fairly long term investment shall have good returns over a fairly long period by opting for the right Class B property.

Those planning to capitalize on the immediate rise in Texas real estate market post-pandemic should opt for Class C assets that will appreciate the enhancement in the market and will also be in high demand when people are just beginning to recover their financial conditions post-pandemic recess.

To know about Texas’s best real estate investments, contact us!

real estate assets

Multifamily Financing for Beginners in Investment

If you want to diversify your real estate assets, multifamily real estate investing can make your portfolio receive amazing returns. Real estate investors are still mostly interested in single-family homes.
Read More

6 Reasons the DFW Market is Booming

The Dallas housing market has recovered from pandemic blows since July of the pandemic year. Since the second half of 2020, demand for single-family houses has increased while supply has
Read More

5 Reasons to Invest in Land Development/ New Construction

Newly built homes can be an excellent investment, particularly for landlords who want to avoid the constant care and repairs that come with older homes. Real estate investors’ primary goal
Read More

New to Real Estate Investing? Here are some tips!

Congratulations if you’re a first-time real estate investor! It’s a great opportunity to enter this industry. There are several tactics to consider and paths to take. It might feel a little daunting at first, but
Read More
COVID affected investments

Is it really beneficial to invest post-COVID?

The acquisition of a property for the aim of ownership or profit is referred to as property investment. This can be accomplished by either upgrading and selling the property or
Read More

Invest in Real Estate, Invest in your Future!

Why Should You Start Investing in Real Estate Today? Real estate investments made in the right place at the right time, deliver incredibly high returns compared to other investments. Compared
Read More