How much do apartment investors make?

But to be fair, salaries can vary greatly depending on the type of investment you make, the number of transactions you make per year, the time you spend on them, and many other factors. Rental income is the main way an apartment building generates money. The rents collected become most of the gross income for that month. Then, the mortgage and expenses are paid, leaving the net operating income, or NOI.

In addition to regular rental income, multi-family properties appreciate over time. This annual growth makes apartment complexes a solid investment to earn money from short-term rental revenues, as well as from long-term value appreciation. This story is part of CNBC's Make It's Millennial Money series, which details how people around the world earn, spend and save their money. Still, he hopes that sharing his story with CNBC Make It will inspire others to start investing in real estate, even with limitations.

Learn more about the world of CNBC Make It. Apartment buildings tend to carry less risk and offer a much higher return on investment than single-family homes. Demand for apartments will continue to drive increases in occupancy and rent, and apartment owners will continue to be paid. Apartments are not valued based on the price of similar properties sold recently, but on the basis of the income they generate compared to apartments in the same area.

Apartment buildings (or multi-family properties) are defined as multi-storey residential buildings in which three or more housing units are within the same structure. The benefits mainly relate to the ability of apartment complexes to generate a fairly high return on investment. To achieve these value increases, the apartment owner and property manager must work together over time to optimize efficiency. And once I learned, I instantly realized how much better apartments can be than investing in single-family homes.

Apartments offer opportunities for syndication and partnership with other investors, unlike single-family properties. There is considerable demand for multi-family housing, due to the limited availability of apartment buildings compared to their demand. If you haven't yet saved enough to finance the apartment complex and to pay for other expenses, such as renovations and maintenance costs, this may not be the right option for you. We can also connect you with real estate teams that sell duplexes, triplexes and quadruplexes, which are easier to manage than apartment buildings and can still be quite lucrative.

The owner of the apartment can install and rent lockers for packages, which provide a necessary service to residents, as well as additional income. Let's see exactly how apartment buildings make money, so that the next time you visit an apartment complex, you start to see it for what it is. There is no limit to how often this exchange can be made and it allows investors to increase their tax-free investments. As many investors have noticed during this pandemic, several asset classes are experiencing a more challenging market, such as offices and retail.