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Multifamily properties have always been in high demand for investors, and that trend doesn’t look like it will be stopping any time soon. These properties offer incredible financial stability, and benefits like appreciation and tax deductions to take investment returns further. Brokers and wholesale partners can take advantage of this lucrative niche by offering financial products specifically designed for this market. They can also leverage the expertise of private lenders to help position themselves for success.
Continue reading to learn about the benefits of adding multifamily offerings to your product mix, and how brokers can utilize private lending to unlock their potential and close bigger deals.
The Growing Appeal of Multifamily Properties
One of the main reasons multifamily properties are so desirable is their ability to offer consistent returns to investors. Having multiple cash-flowing rental units means that the cap rate of these investments is often higher than with single-family homes, and vacancies have less of an overall financial impact. Investors also purchase multifamily properties when they want to scale their portfolios quickly, or when they’re looking to diversify by expanding into a new market or property type. These properties offer unmatched appreciation because they are always in demand, and investors can make use of tax advantages to reduce their taxable income and maximize returns.
Benefits of Multifamily Investments for Brokers
Brokers and wholesale partners can also benefit from adding multifamily offerings to their financial toolset. Having a diverse range of financing products means that you can serve a wider variety of clients, and you can reach markets you previously weren’t able to. Having experience with multifamily deals also means you can position yourself as an expert in the asset class, and investors are more likely to return to you to solve their financing problems. Additionally, multifamily investments are often high dollar-value deals which means an attractive commission for financing and wholesale partners.
A Broker’s Role in Multifamily Investing
To maximize the value of multifamily investments for your clients, here are a few ways you as a broker can help. Begin by taking time to understand your client’s goals, like if they prefer a hands-off cash flow approach, or are looking for value-add opportunities. You can also take this opportunity to educate your clients on the advantages of multifamily investments, including ones they may not have known about.
Another important role you will serve is helping your clients evaluate potential deals, including looking at key metrics like cap rate, occupancy rate, and estimated cash flow. They will be sure to appreciate the expertise and market knowledge you can provide to help them make better investment decisions.
Leveraging Private Lending for Multifamily Success
Private lenders can help brokers and lending partners find more success in the competitive niche of multifamily investments. They can provide competitive rates with their financing programs, which gives brokers more flexibility when securing their own deals. Additionally, private lenders can provide tailored solutions for a variety of deals, from traditional rental loans to renovations and stabilized bridge financing. Brokers can benefit by adding a wider portfolio of offerings to their own financing solutions, and they can offer more customized loans to fit the needs of each specific project brought to them by clients.
Strategies for Brokers to Close Bigger Multifamily Deals
Are you a broker that’s looking to close bigger and better multifamily deals? Here are a few final tips to help you find success. Start by expanding your knowledge about the multifamily market, learning the ins-and-outs of this niche and how to identify profitable opportunities for your clients. You should also take time to understand the details of multifamily financing programs, so that you can help simplify them to your clients and provide more value to them.
Partnering with the right lender will also be key here. Choose partners that have experience in the multifamily space, and which can provide competitive rates and financing terms for your clients. You may also want to look into the track record of your chosen lending partner, and the type of support they provide to brokers and wholesale partners.
Finally, you should look to provide value to your clients beyond financing. Connect them with resources and partners that can help them with their investments, such as property managers, contractors, and legal experts. Or offer long-term support by checking in with your clients regularly, helping to build a working relationship with them.
RCN Capital
The easiest way to save on an investment is to obtain financing from a real estate lender that can provide you with the best leverages and rates. RCN Capital lends to real estate professionals, commercial contractors, developers & small business owners across the nation. We provide short-term fix & flip financing, long-term rental financing, and new construction financing for real estate investors. If you are looking to finance a real estate project, RCN Capital has competitive loan options available.