Investor Choice Realty, Inc.

2-4 Unit Properties are a Different Animal

Financing is different: Multifamily properties up to 4 units can qualify for Fannie Mae financing and some lenders will go up to 90% or even 95% loan-to-value. Contrast this to properties of 5 or more units that are classified as "commercial" and can rarely get more than 80% loan-to-value. (One major exception is if the owner lives in one of the units!)

Pricing / Financial Evaluation is different: While Cap Rates are probably the most widely used index for evaluating 5+ unit multifamily properties, for 2-4 unit properties, Gross Rent Multiplier is perhaps the most commonly used benchmark. This is simply the price divided by the gross monthly rent. A Gross Rent Multiplier of 100 would mean that the monthly rents are 1/100 (one percent) of the price. Perhaps because it is possible to use more financial leverage for 2-4 unit properties, that is, because it requires less cash, the price per unit will almost always be higher than for a comparable 5+ unit property.

Marketing is different: 2-4 unit properties tend to be owned by smaller investors (although there are certainly exceptions). These investors are more likely to have a residential agent or broker representing them and so MLS becomes more important. Many of the commercial websites and marketing systems do not allow posting of 2-4 unit properties.

We give the Seller a choice!

You can choose between:
1) Full Service Listing: We offer the regular style of full-service listing service where we are paid a commission on a contingency basis. And, we also offer:

2) Flat Fee Listing: We produce a professional marketing package for your property, and enter it in MLS and all relevant websites (Including CityFeet, LoopNet, CCIM site, CIMLS and several other commercial real estate websites and marketing services). You pay a one-time flat fee up-front, plus the regular MLS fee at closing (0.012% of the selling price, if you decide to put it in MLS).

We give the Buyer a choice!

You can choose between:
1) Full Service Property Search: We offer the regular style of full-service buyer representation in which we search, network, and identify properties that meet your criteria. If a property is not listed, or does not offer a buyer-side commission, we incorporate our commission into the price. And, we also offer:

2) Rebate to the Buyer: If you have already identified the property you are interested in, we provide assistance in preparing an offer, negotiating the price, getting the best possible financing, coordinating due diligence, etc., but since you did the work of finding the property, we will rebate a portion of the buyer-side commission depending on how many contracts we have to write and negotiate.

For More Information Contact:
Vaughan P. Simmons, CCIM
Atlanta Apartment Brokers
1955 Cliff Valley Way, Suite 200
Atlanta, GA 30329
Tel: 404-634-6030
Cell/Direct: 404-569-3465
Fax: 404-806-4405
atlaptbrokers@bellsouth.net