Boston's Innovative Path to Home Ownership: Multi-families
After graduating college in 2016 with a degree in finance, Frantz Jacques began working as an account executive in Chicago and saving to buy his first home. Raised in a family of homeowners in Evanston just north of the city, he says he realized early on the benefits of owning real estate.
But after a year of facing bidding wars on some listings and being priced out of others, the 25-year-old decided to take an unconventional path to homeownership for a first-time buyer: He began shopping for a multifamily property rather than making a single-family residence his first real estate investment.
Like first-time home buyers in other expensive cities, where high prices and tight inventory have sidelined many millennials, Jacques says the multifamily route will allow him to live in the home while renting the other units to help defray mortgage costs and build equity.
Another advantage is that lenders tend to offer certain incentives for such investments — better interest rates and lower down payment requirements than for single-family properties.
With the help of Sanina Ellison, a principal owner at Chicago Homes Realty Group, Jacques is now looking at two- to four-unit multifamily properties in Bronzeville and South Shore, two South Side neighborhoods with lower prices and increased development.
“I didn’t want to be sitting on the sidelines and playing this waiting game to own a home,” says Jacques, who is financing the investment through a Federal Housing Administration loan, government-backed financing that can be used for properties with up to four units. “It feels like the longer I wait, the more out of reach homeownership would become.”