3 Types of Properties That First- and Last-Time Homebuyers Are Neglecting
Jan 26, 20233 Types of Properties That First- & Last-Time Homebuyers Are Neglecting
by Pat Kapowich
I’ve been in the real estate industry since 1988, and since then, I’ve rarely heard prospective homebuyers proclaim, “I want to be an owner-occupant in a duplex, triplex, or quadplex.”
However, I have seen countless first- and last-time homebuyers focus on a detached, single-family house.
But do you want to know a secret?
Residential real estate agents and their preferred loan officers work under the term of art: One to four family properties. Yet, its meaning is seldom explained or explored.
The one-to-four residential lending for the owner-occupant of a multi-family building is the same for condominiums, townhouses, or single-family homes.
#1: The One in 1-4 Family Property
- Condominium or townhouse
- Modular home affixed to a foundation
- Detached or attached single-family home
#2: The Two to Four in 2-4 Family
- Duplex
- Triplex
- Quadplex, AKA fourplex
#3: Owner-Occupied Financing
Here are the preferred one-to-four family-lending options:
- Conventional lending
- VA lending (Veterans Administration)
- First-time buyer programs
- FHA lending Federal Housing Administration
Easy, right?
It gets better.
#4: Owner-Occupied Advantages
Here’s owner-occupied 1-4 lending advantages:
- Lower down payments
- Lower interest rates
- Helps pay the monthly loan payment
- Qualification requirements are not as demanding
#5: Rental Income
Here are a few options:
- Live in one unit while tenants and/or family live in the other(s)
- Hire a property manager or manage the building yourself
- Eventually, move out and rent your owner-occupied unit.
That’s it!
A missed 1-4 family residential property conversation is a missed opportunity or keeps people from making a move altogether.
