You may or may not know which direction to go when it comes to investing. Houses, apartments, and lofts each have their own benefits and drawbacks in the New Jersey, New York, and Philadelphia areas. While playing to your strengths is usually the best route, it is also important to take into consideration any way you can expand and improve your investment portfolio. But which way to go? We’ve broken down the pros and cons of each residential type of real estate you might consider investing in to help you figure out where you should spend your time.
Many investors begin their real estate strategy with their own home. This can be one of the easier ways of starting because you can make some small changes to your house to make it a multi-family home and then immediately start renting it out (maybe while you’re even still living there). This can help you quickly pay off your mortgage and make a profit. It’s also important to consider the fact that with most houses, their value increases. The downside to a house, however, is that you will be on call for any maintenance issues that arise within the property.
Typically, apartments are built by a group of developers or funded by a group of investors. Usually the sheer amount of capital you would need to build an apartment complex is what steers amateur and single investors away. Also, because apartments contain so many spaces, a maintenance team would most likely be needed (normally, a single investor will not be able to handle the potential amount of maintenance requests at one time). However, apartments lead to a larger, dependable monthly income for investors and can pave the way for more investments.
Lofts tend to be unused spaces above restaurants, warehouses, and businesses in cities around New York, New Jersey, or even Philadelphia. Lofts are generally cheap to invest in compared to the other residential real estate properties. With more and more condos popping up in the market, people might be even more interested in lofts as something unique and different. The downside to lofts are that there aren’t many available for investing, so searching for lofts to invest in could take time.
With many of these properties, the issue of being “on-call” by tenants is very prevalent. However, you can easily skirt around this and reap the benefits by utilizing a property management company. Being an investor is no easy job by any means, so having a company that can do the hardest work on the property is a major bonus. Located in Central New Jersey, C.A.B. Group manages properties throughout the state and surrounding New York City and Philadelphia areas.