Multi-family homes in vogue with investors

As housing investors dip their toes back in, interest grows in multi-family homes.

In past recessed years, many have seen the value of their 401Ks or other retirement funds slip away.

Now, they're searching for other steady sources of income.

According Kevin Borman, the Grand Junction Area Realtor Association board chairman, some residents are finding one solution in multi-family properties like duplexes or four-plexes, which can bring in multiple rent payments a month.

"The market is substantially improving. A lot of people are looking at investments saying, 'How do I build that passive income?'" said Borman.

It's a lesson in Economics 101: your basic rule of supply and demand.

"The less that we have on the market, the more people see the need and they move a little faster on what they're seeing out there," said Mandy Harter, a broker associate for Remax 4000.

According to Keller Williams Realtor Doug van Etten, our local market holds about 47 multi-family homes right now, compared to 1100 residential properties in total.

That limited supply of multi-family homes creates a higher demand.

"We're probably going to start seeing that push prices upward hopefully in the near future," said van Etten.

The prospects here are also attracting outside investors.

"I've been contacted a number of times recently by investors from Denver who are saying that the Denver market is really saturated with investors and they want to branch out and see what kind of opportunities might be elsewhere," van Etten said.

For Bormna, there?s no better time to get into the market.

"The buying power for the investors is the strongest that they've ever been, and the reason for that right now is that prices have dropped down and have kind of leveled off and the interest rates are at 40-year lows or better: 40 to 50-year lows," Borman said.

Harter said many of the properties on the market need some maintenance, giving prospective owners a chance to "buy these properties, fix them up a little bit, and make them a better rental, ask for an increased rent, increase your cap rate.?

The limited supply of multi family homes reflects what these realtors have seen in the general housing market. Van Etten said single family house listings are down about 35 percent compared to last year.

Nationally, the median list price for homes rose over 2.5 percent compared with a year ago, while the inventory of homes fell by nearly 20 percent in that same time period.

Source: http://www.nbc11news.com/home/headlines/Multi-family_homes_in_vogue_with_investors_162795346.html

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