Multifamily Minute Reader Reflections: How Do You Invest in Apartment Buildings?
Our survey of 45,000 multifamily investors reveal the most popular ways to invest in apartment buildings today.
Start Your Application and Unlock the Power of Choice$5.6M offered by a Bank$1.2M offered by a Bank$2M offered by an Agency$1.4M offered by a Credit UnionClick Here to Get Quotes!Multifamily properties come in all shapes and sizes, and so too are there a multitude of different ways to invest in them.
Last Tuesday, I asked you how you invest in apartment buildings. Do you use syndications, or do you go it alone? Do you prefer using crowdfunding platforms or investing in REITs?
Survey Results
Let's get right to the results. Note that the results won't add up to 100%, as many of our subscribers use two or more investment approaches.
Method of investment | Percent of respondents |
|---|---|
Sole ownership | 63% |
Joint ventures | 29% |
Syndications (as an LP) | 8% |
Syndications (as a GP) | 11% |
REITs | 2% |
Crowdfunding platforms | 8% |
I've never invested in multifamily | 1% |
Other | 21% |
Most of you own your properties on your own — that didn't surprise me. When you're the only one involved in your investment, you have complete control over how you run your apartment building. Further, you don't have to split your rental income or share the proceeds once you sell. And while many people might suggest it's riskier — after all, you are also responsible for 100% of the costs and expenses — you can mitigate this through diversifying your portfolio.
At the end of the day, there's really no right or wrong way to invest in multifamily. Much of it comes down to how much capital you have available to invest and how much time you're willing to commit to making the investment work.
People who invest in syndications as LPs or even in REIT stocks, for example, generally don't want (or have time for) the headaches involved in running a property's day-to-day operations.
Of course, even sole owners can minimize their time through the use of a solid third-party management company. That's true for investors running their own multifamily syndications, too — and that's one approach where experience is far more important than capital on hand.
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Last Week's Survey Results
My previous survey focused on multifamily's recovery — namely, when you expect it to happen. I'm optimistic that we'll see the turnaround begin next summer, and I'm not alone, from what you told me. Read last week's results.