Articles about the financial considerations of multifamily properties
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The world of duplex or multi-family investing is ripe with opportunity. These properties can be valuable assets in your portfolio. They can also generate significant income with multiple tenants on one property. Along with that, multiplex investing also comes with various tax benefits.


Please note: This is not individual advice, but rather a general summary of some of the tax benefits of investing in real estate. You should absolutely consult with your professional tax advisor before assuming these would benefit your specific situation.

Exploring the Tax Benefits

Deducting Loan Interest

Most real estate investors need to borrow to finance properties. That can make loan interest a significant expense. However, mortgage interest is deductible…

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There are several reasons why real estate is the top investment option for many people. Chief among these reasons is that people see it as a reliable way to build wealth. However, there are many ways to invest in real estate.

This post will cover how people can build wealth with real estate investing. We will focus primarily on direct real estate investments and residential properties.

Using Real Estate Investing to Build Wealth

Owning a Home

Your home isn’t just a place to live but also an investment. With every payment you make on your mortgage, you are building wealth. There is also a good chance the property will appreciate over time. Homeowners can use this wealth in many ways. Many even use home equity to finance investment…

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Many investors view buying a duplex as a big step in their investment strategy. You are moving from single-family properties to having multiple tenants. While there are definite differences between these types of properties, they also have similarities.

However, if you compare a duplex to two single-family homes, managing the duplex is simpler. The most obvious difference is that you will have two units on the property instead of one. That can mean two rent checks but also two tenants to manage.

What are some of the ways duplexes are similar to single-family homes? Read on to find out!

Similarities Between Buying a Duplex and a Single-Family Home

Purchase Price

The average duplex will cost more than the average single-family home.…

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There are many advantages to investing in duplexes. You can have double the rent on one property when comparing it to investing in single-family homes. It is also simpler and more affordable than investing in large multi-unit properties. One point to consider is the financial requirements of duplex investing. Lenders will be stricter and apply different standards. It isn’t necessarily the same as financing a single-family home as your primary residence.

Learn the Financial Requirements

Down Payment

You’ll need a down payment to finance the purchase of your duplex. If the duplex is an investment property, you will likely need a larger down payment than you would for a primary residence. However if you're going to live in the property as an…

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Calculating Cap Rate  

The Cap Rate is a quick way to check the financial outlook of a multifamily investment property. So how do you calculate the cap rate on an investment property? The basic calculation is pretty simple:

Cap Rate = Net Income / Property Value

Cap Rate Example
Let's do an example of calculating the Cap Rate. You’ll need these numbers:

  1. Property Value. Not just the asking price, but what the property is actually worth. Your Realtor can help you determine this number by pulling comps for similar multifamily properties that have sold in the area. For our example let’s say that you’ve found a duplex that is worth $300,000.
  2. Gross Income. This is the gross rent that the owner would receive. For our example we’re going to say that the property is rented…

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