The Time And Energy Advantage Of Apartment Building InvestmentQuestion: Which requires more time and effort. Buying one 54 unit apartment building investment or buying 54 separate single family investment properties? I think the answer is quite obvious, but let's take a closer look. Whether you are buying houses or multi unit buildings, you will still have to review many, many more properties than you will actually close on. For argument sake, let's assume that you have a fairly efficient screening system for weeding out potential single family investment opportunities. Our assumption is that you would only close on one home for every twenty that you review. (I would guess that the number is closer to 50 or 100, but even as low as 20 you will see my point.) Now, let's assume that you would typically analyze 100 apartment buildings before finding one that fits your investment strategy. In order to close on 54 houses, you would have to screen 1,080 properties. How many deals would you have to screen in order to close on one, 54 unit apartment building investment? One hundred. Now let's consider a couple of other things. How much time do you think it would take to actually go through the closing of 54 properties, and then deal with the ongoing management and maintenance of those properties. Compare that to one closing and the ability to hire people to manage your one apartment building. Considering that many people who invest in real estate do so on a part time basis in addition to holding down a full time job, you can quickly see why the "time and effort" advantage of apartment building investment is so important. When you combine this with the many other advantages of it just starts to make a lot of sense. Concentration of effort is the key here. Clearly the "time and effort" advantage falls on the side of the multi unit property investment. A Final Note: Why did I use a 54 unit building in the example above. My first commercial apartment building investment was 54 units (actually it was 45 apartment units and 9 commercial spaces). That was about 12 years ago now and for me there has been no turning back to single family investing.
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