What’s more attractive… 12 single-family homes spread out across a city to manage, or 12 units under one roof? With the 12 individual properties, you may need more than one property manager; with the one building you only need one manager.

Now let’s say you have a 72-unit building. You still only need one manager on site or one property management company that will handle rent collection, tenant issues, and grounds and other management duties.

Finding a great property manager means you have to ask the right questions, and you always want to have a plan B in case the property manager or management company doesn’t work out. You will pay less per unit for a multifamily property than for a comparable house commanding similar rent.

In part, it’s because you’re competing with purchasers who buy homes to live in and their emotions drive prices higher. Paying more for an investment property puts you at an immediate disadvantage. It reduces your cash flow and adversely impacts your profit when you sell.

Most of the investors want to get single household homes and because of this the price of these kinds of properties also increase which can turn into a liability instead of an asset for you. Keep in mind that you would want to earn simply by buying a property without having to wait for someone else to buy the property from you.

Even relatively conservative and low-yielding apartments offer healthy returns relative to other asset classes. Many investors are attracted to the cash flow, which, depending on how you buy your apartment, can be anywhere from a few percent to the mid-teens per year, calculated relative to your down payment. However, you're also paying your loan down, and this adds to the return you'll realize either when you sell the building and cash in your equity or when you pay the loan off and get an immediate increase in monthly income. While principal reduction may not seem like a major contributor to your return, bear in mind that your mortgage increases its impact, since the growth is relative to your down payment.

Even relatively conservative and low-yielding apartments offer healthy returns relative to other asset classes. Many investors are attracted to the cash flow, which, depending on how you buy your apartment, can be anywhere from a few percent to the mid-teens per year, calculated relative to your down payment. However, you're also paying your loan down, and this adds to the return you'll realize either when you sell the building and cash in your equity or when you pay the loan off and get an immediate increase in monthly income. While principal reduction may not seem like a major contributor to your return, bear in mind that your mortgage increases its impact, since the growth is relative to your down payment.

Like other forms of investment real estate, you can write off all of your expenses with essentially no limit to reduce your taxable income. If you use the proceeds from selling your apartment to buy more investment real estate, you can also defer your capital gains and recapture taxes. You can also depreciate your apartment and write off a portion of its value every year, further reducing your tax liability. Unlike commercial real estate that has a 39-year life, apartments get depreciated over 27.5 years, giving you a larger write-off every year than with other property types.

Owning apartments isn't like having money in the bank. You can't go to your apartment building and pull your money out whenever you want. Taking out equity through a cash-out refinance can take months and cost thousands of dollars in loan fees. Selling also takes months and could generate many thousands of dollars of commission costs. As such, if you aren't sure that you want your money to stay invested, apartments might not be a good choice.

Owning apartments isn't like having money in the bank. You can't go to your apartment building and pull your money out whenever you want. Taking out equity through a cash-out refinance can take months and cost thousands of dollars in loan fees. Selling also takes months and could generate many thousands of dollars of commission costs. As such, if you aren't sure that you want your money to stay invested, apartments might not be a good choice.