What qualifies as a triplex?
A building with three housing units is referred to as a Triplex Buildings. That means a triplex building has one lower unit or floor, one middle unit and atop the level floor. Generally, these are a result of combined apartments, but at times some houses are purposely built in this fashion.
Talking about the design of the triplex buildings; these are found both in townhouses and as separate units. At times, the basement works as first unit, the ground floor with kitchen and living space as the second unit and the top floor with bedrooms as the third unit.
Generally expensive, these are found as both condominiums and townhouses. While some of the dwellings have each unit stacked on top of the other, other developments have these arranged in a row side by side, separated by a firewall.
Triplex buildings work extremely well in large and growing cities. These can easily accommodate 2-3 families and are often called "multi-family units/buildings". Some of the buildings have the same exterior facade while others have different exterior for different units to add modernity to the designs.
Isn’t a triplex commercial real estate?
Real estate professionals break the commercial real estate market into different submarkets: office, retail, medical, hospitality, industrial, and multi-family.
A duplex, triplex, or even a quadplex is technically multifamily real estate. It houses multiple families in a single building. For new multifamily real estate investors, owning a "-plex" is one of the most accessible forms of real estate. The reason why is the financing. It is possible to obtain a residential real estate loan for the purchase of these types of properties. Properties with five or more units require a commercial real estate loan. Additionally, owner-occupied properties have some exceptions when it comes to regulations about tenants and renting.
Since duplex, triplex, and fourplex properties can be owner-occupied types of multifamily real estate and financed with a residential mortgage, we’re looking at them as residential real estate.
Why develop a triplex?
Most of the time, people considering buying a duplex, triplex or fourplex are interested in their investment potential. A few common advantages of developing a triplex are:
• Lower resale price point means easier to sell
• More units to sell - could mean more/less profit*
• Works well in areas for semi retirees or first home buyers
Triplex Profits
If we were to sell a 3 bed 2 bathroom home with a theatre of approximately 130 square metres of internal living area, we are competing in a fierce market place. The approximate selling price in the Perth metro area we would estimate somewhere between $390,000 to $440,000 in a good market. Approximate profit is typically around $30,000 per unit or $90,000 for the development.
*Note final allowable building coverage will be different from council to council based on concessionary allowances.
Can't Decide What To Build?
A duplex or triplex is a relatively simple style of development making them popular among new developers and one of the most sought after property investment solutions.
Dual Keys might be a great, cash-flow positive, adding to your portfolio, to help you grow your income and keep your portfolio in balance. If you need more information, call us today!
source: vaastudesigners, dalealcock, dualincomeplus
