What Is a Multifamily Home: Everything You Need to Knowing

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Written By Tommy

DealBloom aims to share the latest tips and strategies to help realtors, brokers, loan officers, and investors navigate the world of real estate.

If you’re considering buying a multi-family home, you might wonder what exactly that is. This blog post will tell you what is a multifamily home, and how to buy one. So, read on to make the best decision about this purchase.

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What is a Multifamily Home?

What is a multifamily home? A multi-family home is a dwelling that is subdivided into multiple living units. It is one building designed to accommodate multiple families and has separate entrances for each family. These homes are also known as duplexes, triplexes, and fourplexes.

The rules for getting a mortgage for a duplex or triplex are different depending on whether you plan to occupy the property or not. If you own a multi-family building, you can either live in one unit and rent out the rest or rent them all out and live somewhere else. If you plan to use it as an investment, you may be able to use the estimated rental income from the units to help qualify you for a loan, and you may even qualify for a larger loan.

A multi-family property can be a great way to generate passive revenue for real estate investors. 

Types of Multifamily Homes

There are different kinds of multi-family homes, each with its layout, square footage, and amenities. Each type has its benefits and drawbacks.

Duplex and triplex

Duplexes are two dwelling units that share a wall, a ceiling or the floor with another. A tri-plex, on the other hand, has three separate housing units. Each has its own entrance. They may also have a separate yard and garage.


A condominium is an individual dwelling that is part of a complex of buildings, each separately owned by individuals. These owners usually pay monthly dues to a homeowners’ or HOA (Homeowners’ Association), which pays for the maintenance and general upkeep of the common areas.


Townhouses are a type of dwelling attached to another house by a shared common wall and typically have 2-3 floors. They are more spacious and require less maintenance than apartments.

Semi-detached home

Semi-detached homes are like townhouses, except they are typically larger. These properties can be less expensive than free-standing single-family homes, and they may also offer lower maintenance costs, as owners of these houses may split the cost of upkeep.

The Pros and Cons of Multifamily Homes


  • A multi-family house’s rental income can help you cover your mortgage payments, utilities, and other costs. This can allow you to use your cash flow for other projects.
  • You’ll have greater control over your rental property if you live nearby. It’s easier to catch small issues before they become big problems, and you’ll be able to fix them quickly.
  • You can dismiss much of your home maintenance expenses as business expenses, including mortgage payments.
  • These homes can be ideal for multi-generation families who want to live close together but retain some degree of separation and privacy. (They can also help open such an option to you in the future.)
  • If you move into a unit but end up moving out, you can hold onto it as an income-producing property, renting it out once you leave.


  • Buying a multi-family property may be more expensive than buying a single-family home.
  • Being a landlord is a time commitment, and living close to your renters may mean you’ll be getting visits at all hours. It also means you’ll have to be comfortable handling leases, vet applicants, and be professional when collecting the monthly rent.
  • Even if you don’t make a mortgage payment each month, there can still be financial risks involved in owning multiple family properties. Even if the housing units are empty or the tenant is behind on payments, you still have to pay the mortgage. And you’ll also have to cover the cost of quickly fixing problems like leaking roofs or backed-up toilets.
  • The more properties you have, the more money you’ll make, but you’ll need plenty of cash reserves for unforeseen repairs, vacancies, and tenant turnover.
  • Selling a multi-family home with existing residents can be tricky, as you’ll have to arrange times for prospective buyers to view the property and appraisers to come by. You’ll also have to keep the renters in the loop about the process.

Things to Consider Before Buying or Renting a Multi-family Home

If you’re considering a multi-family home, you should consider a few things before making the big decision. Here are five things to consider before buying or renting a multi-family home:

1. Location

Location is one of the most important factors when choosing a multi-family home. You’ll want to ensure the home is in a safe neighborhood you’re comfortable.

2. Size

Another important factor to consider is the size of the home. You’ll want to ensure the home is large enough to accommodate you and your family comfortably.

3. Maintenance

When you own a multi-family home, you’re responsible for upkeep and maintenance. This can be a lot of work, so be sure you’re prepared to handle it before making the purchase.

4. Finances

A multi-family property investing is a big financial responsibility. Be sure you’re prepared to handle the mortgage and other associated costs before purchasing.

5. Lifestyle

Living in a multi-family home means having different lifestyle habits than if you were living in a single-family residence. You’ll need to be prepared for the noise and activity that comes with living in close proximity to others.

Managing Multi-family

You have several options to choose from when managing a multi-family property. With smaller properties, you may decide to manage them. However, managing them is not all that difficult, but there are legal and functional essential rules you should adhere to.

Being a landlord is not for the lazy or faint of heart. You must be organized, professional and know how to deal with people. You will need to know how to promote your properties, screen potential renters, and lease your unit. And, of course, you’ll need to know how to deal with any problems.

If you choose not to manage the unit yourself, you will need to obtain a property manager. These managers typically charge a fee of 5% to 10% of the monthly rent and additional fees. This can save you time, allowing you to focus on finding other investments. Just be aware that even though you have a property manager, you will still need to keep a close eye on them or replace them.

Who are Multifamily Homes Best Suited for?

Multi-family real estate investments are best for those interested in getting into the real estate market and generating wealth. This is because they are comfortable with being landlords and have the time to invest in their tenants.

This type of home allows you to live in one unit and rent out the other(s), earning you a passive income. Once the mortgage payment is taken care of, the additional(s) rental income can cover your living expenses.

Multi-family homes are a great choice for multi-generation families who want to live under the same roof but still have their own spaces.

Frequently Asked Questions

What is an example of a multi-family home?

A multi-family house is a home that accommodates more than one family, typically under one roof.

What is the difference between residential and multi-family?

A multi-family home is a building that has more than one dwelling unit. Residential property is a property that contains only one dwelling unit.

What makes something multi-family?

A multi-family home is a house that accommodates multiple families, usually under the same roof.


What is a multifamily home? A multi-family home is a property that comprises two or more separate dwelling units. These units include condos, apartments, townhouses, duplexes, triplexes, and fourplexes.

Before buying a multi-family building, it’s important to thoroughly do your due diligence on the area. You’ll want to look for properties in areas with high rent demands and potential for future value increases. Lastly, be prepared to be the landlord: handling maintenance, repairs, and tenant issues.