#2 Greater Control of Property Value
With a single-family property, you are almost completely at the mercy of market forces.
If you need to sell in a down market your hands will be relatively tied. The value of your property will be determined by what other properties have sold for in the local area at that time.
A multifamily property is perceived somewhat differently because of its commercial nature. It is managed and run as a business and therefore a significant part of its value is determined in the same way as a business. This means that the value is much more in your own hands.
Businesses are valued largely on their profitability and, in a similar way; a multifamily property’s value is determined by its net operating income.
Something as straightforward as adding a laundry facility or some paid parking are two examples that can very positively affect the profitability of your multifamily property and in turn, its value.
With a multifamily property, there are many more ways that you can bring your management and entrepreneurial skills to bear to increase the value of the property independently of the surrounding property market.
In a nutshell, you have the ability to raise the value of your multifamily property by decreasing expenses and increasing income.