Multifamily Investing
Review larger residential investment considerations.
Open ResourceSample Multifamily case study
Worcester Six-Unit Multifamily Acquisition
A six-unit property produces cash flow, but coverage and return remain thinner than the sample investor’s target.
Educational sample—not an actual transaction.All property details, people, figures, and outcomes are hypothetical.
Sample assumptions
Property and Financing
| Purchase price | $900,000 |
|---|---|
| Loan | $675,000 at 7.25%, 25 years |
| Average rent | $1,650/unit/month |
| Cash invested | $260,000 |
Modeled results
Financial Analysis
| Scheduled rent | $118,800 |
|---|---|
| Vacancy | $5,940 |
| Operating expenses | $43,000 |
| NOI | $69,860 |
| Debt service | $58,548 |
| Annual cash flow | $11,312 |
| DSCR | 1.19x |
| Cash-on-cash return | 4.35% |
Risk review
What to Examine
Reconcile leases and deposits with actual records.
A lender may require a higher DSCR and lower loan amount.
Deferred maintenance could consume several years of cash flow.
Test price reduction, equity, expenses, and lawful rent improvements.
Primary lesson
Positive cash flow is not automatically sufficient; the margin must compensate for capital, workload, and downside risk.
Replace every sample assumption with property-specific evidence. Test conservative income, expenses, construction, financing, timing, and exit scenarios before committing funds.
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Guides and Tools for This Case Study
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Apartment Buildings
Understand the property type and operations.
Open ResourceDSCR Calculator
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Organize multifamily due diligence.
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