Posted November 14, 2018

Fourplexes are great for entry level investors. Some new investors will “house hack” a fourplex by living in one unit and renting out the other three. This strategy can also make the loan process easier because you are buying a primary residence along with the investment. In many cases, you can live with little or no monthly payment, or even clear a monthly profit. For those seeking financial independence, the house hacking strategy is a compelling and dramatic way to make big financial strides toward their financial freedom. For more traditional investors, a fourplex offers greater cashflow security. In a single-family home, you either have it rented out or you don’t. An extended vacancy in a single-family home can quickly wipe out any accrued profits. In the case of a fourplex, a single vacancy still means you have 75% of the cashflow coming in. It would be a rare situation to lose all four tenants at the same time. A fourplex offers an attainable way for entry-level investors to get into multi-family investing without spending millions of dollars on an apartment complex. My analysis below is based on leasing out all four units. This particular fourplex is nice because it appears to be fairly turnkey. The seller states that much of the major improvement work has already been done. The current rents appear to be below market rates, so there may be some opportunity for improved future cashflow.