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Old 06-23-2019, 12:26 AM   #8
bizaro86
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I'd caution against buying a 6-plex sized building. They are not a great size for a few reasons.

On the financing side, typically banks will offer residential mortgages on 4-plex and smaller. So you can't get a standard residential mortgage, have to go commercial with higher down payments (typically). Also, a six plex will be a small deal for a commercial loan, making it less desirable.

The same lack of economy applies to building items. A four plex or smaller will typically have individual furnaces for each unit, small cheap residential ones. A six plex probably has a boiler. But you only have six units to spread the cost of replacing/maintaining it.

Similar to the roof/snow removal/grass/garbage/recycling/compost. You're too big to just get tenants to do their own snow/grass, but not spreading the cost among many rents. You're too big to get green/blue/black bins, but not spreading the cost of (mandatory) service among many units.

There is a reason 6-plex buildings are the cheapest on a per unit basis, and the reason is they are structurally less profitable then smaller (4 plex) or larger (12 plex+) buildings.
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