Blog Post

Lee's Summit Multi Family vs. Single Family Investing - Which is Right for You?

Karen Wyle • Feb 12, 2021

At Midwest Property Resources, we work hard to lease, manage, and maintain both single-family homes and multi-family units. Both classes of residential rental properties make excellent investments, but for different reasons.

If you’re thinking about investing in Lee’s Summit real estate, but you’re not sure which type of property to focus on, we have some things for you to consider.

Single-Family Properties and Tenant Selection

A single-family home is always a great investment option because they are always in demand among highly qualified tenants.

The tenants you attract with a well-maintained single-family home in a good location will want stability, and they are likely to maintain the home just like it’s their own property. These tenants are often interested in owning a home, but they prefer to rent because they like the freedom and the low-maintenance lifestyle renting affords. Single-family homes appeal to tenants who want good school districts and proximity to commuter routes and shopping.

These rental properties also offer investors some great appreciation potential because values are always increasing at a rate that outpaces multifamily homes. In the Lee’s Summit rental market, you can expect to cash flow your single-family home and build some equity quickly. The cost of these homes is not as high as in some other markets on the coasts, and you’ll collect a pretty consistent and reliable rent.

One of the challenges to owning single-family homes is that your maintenance costs may be higher. Even if your property is new or in good shape, you’ll probably spend a little more keeping it in excellent condition. There may be landscaping costs that you cannot pass on to your tenants. Unless you’re paying in cash, you’ll probably need at least 20 percent down when you’re looking for a mortgage, especially if you’re financing your investment through a traditional bank.

Multi-Family Properties and Vacancy Protection

Multi-family properties are often duplexes, triplexes, or even small apartment buildings. When you invest in a multi-family property, you’ll have more than one tenant in place, which means you have more than one rental income stream. This is the major benefit of investing in multi-family properties; you will have rent coming in from various sources. So, if one unit is vacant, you aren’t losing a lot of money quickly.

You still have rental payments coming in from the other units.

Economy of scale is another benefit to renting out a multi-family unit. When you need maintenance or landscaping services, you can contract with a vendor who is likely to provide a discount because of the volume of work you need. You’ll save time and money maintaining a single building with two or three units.

Tenants are more than neighbors with multi-family units; they’re often sharing walls and communal space. This means conflicts and disputes can arise between your tenants more frequently. There might be complaints about noise or parking or trash or pets. This can take some extra time and lead to frustration for you as the landlord.

These are just a few of the pros and cons to buying a single-family home or a multifamily investment. We’d like to help you explore your options, so contact us at Midwest Property Resources.

Since its founding in 2011, Midwest Property Resources has been innovating property management and leasing in eastern Jackson County, northern Cass County, Missouri as well as Johnson County, KS, serving the communities of Lee’s Summit, Blue Springs, Greenwood, Raymore, Independence, Overland Park, and others that surround them.

< Older Post Newer Post >

Share this post

Best Tips for Self-Managing your Rental Properties

By Trisha Goodale • 17 Mar, 2023

Owning and managing rental properties can be a lucrative business, but it comes with its own set of challenges. From screening tenants to handling maintenance requests, property management requires a lot of time and effort. Here are some tips to help you effectively manage your rental properties and maximize your returns. Set clear expectations Before a tenant moves in, make sure to set clear expectations about the rental agreement. This includes the rent amount, due date, late fees, maintenance responsibilities, and any other rules or regulations. Having a clear agreement in place can prevent misunderstandings and disputes down the line. Screen tenants thoroughly A thorough screening process can help you find reliable tenants who will take care of your property and pay rent on time. Ask for references, run background and credit checks, and verify income and employment. It's also a good idea to have a conversation with potential tenants to get a sense of their personality and communication style. Maintain the property regularly Regular maintenance can prevent small issues from turning into big ones and keep your property in good condition. Schedule regular inspections and make sure to address any repairs or maintenance requests promptly. You can also consider hiring a professional property management company to handle maintenance tasks for you. Communicate effectively Good communication is key to a successful landlord-tenant relationship. Be responsive to tenant requests and keep them informed of any changes or updates related to the property. Establish clear communication channels and respond promptly to calls, emails, or messages. Keep accurate records Maintaining accurate records can help you stay organized and ensure that you are in compliance with local laws and regulations. Keep records of rent payments, maintenance requests, inspections, and any other relevant documents. Consider using property management software to streamline your record-keeping process. Know your legal obligations As a landlord, you have legal obligations to your tenants, including providing safe and habitable living conditions, respecting their privacy, and following eviction procedures if necessary. Make sure you are familiar with local laws and regulations related to rental properties and comply with them at all times. Of course, if you have a property in Lee's Summit, Raymore, Blue Springs or other surrounding areas, we'd love to assist you with all of your property management needs.

Stockpile Cash or Invest in Real Estate?

By Chris Goodale • 07 Feb, 2023

Let's Dive Right In...

Here's How to Hedge Inflation With Your Real Estate Portfolio

By Chris Goodale • 26 Jan, 2022

Here's How to Hedge Inflation With Your Real Estate Portfolio in Lee's Summit, Blue Springs, Raymore, Grain Valley, Overland Park, Lone Jack, and Surrounding areas.