Dec 2, 2022
As a real estate investor, it is worth considering different categories of properties and how their unique benefits and risks could affect your portfolio needs. Before diving into the many potential financial advantages of multi-family residences (MFRs), it is important to understand how MFRs differ from other property types.
A multi-family residence is any residential property containing more than one housing unit. Duplexes, townhouses, and apartment buildings are examples of common MFRs. MFRs are typically used to house several families or a large number of tenants, as opposed to single-family homes.
Investing in multi-family residences can offer a range of financial benefits for investors:
Diversification: Like all real estate investments, MFRs are considered alternative investments. They provide investors with exposure to opportunities outside of the public markets. Diversifying into MFRs can help investors stabilize returns in market downturns or inflationary environments.
Stability: MFRs house numerous tenants, so investors can typically realize more overall cash flow stability than they might from single-family residences. The relative effect of vacancy is lowered when a property is leased to multiple residents.
Efficiency: MFRs are typically considered efficient property types from both a time and cost perspective. For example, it is significantly easier to install appliances for various units in a building rather than being installed house by house. Another efficiency consideration to keep in mind is that MFRs are more adaptable to the needs of a growing population. Since MFRs house more than one tenant they are more efficient from an urban planning standpoint. They also tend to be located in more densely populated areas and therefore often situated near epicenters of commerce and active economic activity.
Investing in multi-family residences can make a great addition to an investment strategy, but they can also come with higher costs and risks than other investments including other types of properties.
Cost of entry: The cost of entry into a multi-family residence is typically higher than that for other types of investments since MFRs can often generate a higher cash flow. Square footage is also typically larger than for single-family residences.
Geographic diversity: MFRs tend to have less geographic diversity than single-family homes since you are investing in one area at a time. Lowered geographic diversity means higher exposure to local economic shocks including changes to your local real estate market.
Active management: MFRs often require more active management and regular maintenance tasks, which can take up extra time and resources.
Taxes and regulations: MFRs may come with additional regulations and taxes that need to be taken into consideration when deciding whether or not they are a good fit for your portfolio.
It’s important to note that many of the disadvantages associated with investing in MFRs are mitigated or become obsolete when investors invest in MFRs through the Landa platform:
At the time this was written, the cost of entry of MFRs on the Landa platform ranged between $11 and $27.50 per property share.
Landa also takes care of the entire property management side of all listed properties so that investors can focus on doing what they do best - investing.
Throughout 2022, cities across the United States have been making a tremendous comeback, with increasing populations and a return to the office in urban environments. In conjunction with the ensuing migratory movement, and after careful due diligence, Landa acquired several multi-family residences in New York. It is our strategy to invest in multi-family residences in areas with lasting economic value, like New York City.
By investing strategically in multi-family residences in areas with lasting economic value, we believe these MFRs will generate steady and long run returns for our investors.
Multi-family residences can be a great way to add value and exponential growth to your portfolio. Investing in multi-family properties can provide investors with stable cash flow and positive appreciation.
If you are interested in learning more about our current MFR offerings or would like to invest in a multi-family property check out our listings on the app.
As always, to ensure your investing goals are met, it's important to do your research before investing, to ensure that the properties you are evaluating will help you reach your investing goals.
All Rights Reserved © Landa Holdings, Inc
Landa Holdings, Inc. ("Landa Holdings") operates the www.landa.app website (the "Site") and the Landa mobile application (the "App")(collectively, the “Platform”). Landa Holdings manages Landa App LLC, Landa App 2 LLC and Landa App 3 LLC (“Landa Issuers”), and raises funds and facilitates the issuance of shares for the Landa Issuers entities through the Platform pursuant to Regulation A under the Securities Act of 1933 (“Regulation A”).
Neither Landa Holdings nor any of its affiliates are a registered broker-dealer or investment advisor. All securities-related activity for the Landa Entities is conducted through Dalmore Group LLC (“Dalmore”), a registered broker-dealer and member of FINRA/SIPC, You can review Dalmore's brokercheck for Dalmore. Banking services are provided by Evolve Bank & Trust, Member FDIC. By opening a custody account on the Platform, you agree to Evolve Bank & Trust’s Custodial Agreement.
Further, Landa Management LLC, a wholly-owned subsidiary of Landa Holdings, manages Landa Financing LLC (“Landa Financing”), and raises funds and facilitates the issuance of shares for Landa Financing through the Platform pursuant to Regulation A. All securities-related activity for Landa Financing is conducted through Rialto Markets LLC (“Rialto”), a registered broker-dealer and member of FINRA/SIPC (for more information on Rialto, review Rialto’s brokercheck for Rialto.
You should speak with your financial advisor, accountant, and/or attorney when evaluating any offering of securities. Neither Landa Holdings, Landa App, nor Dalmore makes any recommendations or provides advice about investments, and no communication, through this website or in any other medium, should be construed as a recommendation for any security offered on or off this investment platform. Nothing in this material should be construed as investment or tax advice, or a solicitation or offer, or a recommendation to buy or sell any securities. The Site and/or the App may make forward-looking statements. You should not rely on these statements but should carefully evaluate the offering materials in assessing any investment opportunity, including the complete set of risk factors that are provided as part of the offering circular for your consideration. We urge you to review the applicable offering circular, available here.
All securities offered by the Landa Entities and Landa Financing are deemed “Shares”. Investing in Shares involves risks, and there is always the potential of losing money when you invest in Shares. Past performance is no guarantee of future results. Investments in Shares are speculative and involve substantial risks to consider before investing, outlined in the respective offering materials and including, but not limited to, illiquidity, lack of diversification, and complete loss of capital. An investment in Shares constitutes only an investment in a particular offering and not in Landa Holdings, Landa App, or any of the underlying asset(s). Investors should carefully review the risks located in the respective offering materials for a more comprehensive discussion of risks.
All Shares will be issued in electronic form only and will not be listed or quoted on any securities exchange. After a Series’ offering has concluded, we expect that the Public Private Execution Network Alternative Trading System, or PPEX ATS (the “Secondary Trading Platform”), which is registered with the SEC and operated by North Capital Private Securities Corporation (“North Capital”), will be the only venue available for the resale of Shares. Resales of Shares will be conducted by Dalmore, as a broker-dealer member of the Secondary Trading Platform; provided, however, any such resale of Shares will be subject to federal and state securities laws and the restrictions in the Series’ Operating Agreement, and there can be no assurance that an active market for any Shares will develop on the Secondary Trading Platform, that the Secondary Trading Platform will be available to allow resales of Shares to residents of all states, or that the Secondary Trading Platform will be available at all. For these reasons, investors must be prepared to hold their Shares indefinitely.
Landa Holdings maintains this website for informational purposes only. All offerings of Series’ Shares (and information about each Series and its underlying property) are conducted exclusively on the Landa Mobile App.