“With our different personalities, I always said I could never live with her,” says the 29-year-old resident of Portland, who teaches math at Freeport High.
But then Maddie and her sister Anna, 27, who teaches preschool, started house hunting. At first Maddie was looking at condos and Anna at single family homes. “I wanted something more in the city and she was okay more on the outskirts,” Maddie says.
As anyone who’s ever shopped for a home in Portland knows, sticker shock can quickly set in. The Soule sisters experience was no different. But then Anna’s broker suggested a solution: Would they consider joining forces and buying a two-family building?
The answer was yes. In December they found the perfect place in the Oakdale neighborhood near USM. And because they opted to go the multi-family route, they were able to each score a home with three bedrooms, instead of the one or two bedrooms they would have had to settle for on their own.
“The greatest thing about the place is they’re identical units,” Maddie says. This allowed them to avoid any sibling squabbles over who would be getting the bigger apartment or the one with a better layout.
“It has been really nice to go through this with her,” Maddie says. “If either of us had gone to do it by ourselves, we would have been overwhelmed.”
Getting help with the mortgage
On a street near the Soule sisters’ new home, Jon Sundberg is getting ready to move into his recently purchased multi-unit. Sundberg, a 28-year-old sales representative for Nassau Broadcasting in Portland, started his home search with the goal of buying an apartment building. When he couldn’t find a place he liked, he switched his search to single family homes, but ultimately came back to multis.
“For me, it was really trying to figure out what was economically feasible for me as a single guy,” Sundberg says. “A multi-unit costs a little more, but you have the rents.”
As he set about crunching the numbers, he quickly realized that the more units or bedrooms he could afford, the more he could earn in rent. In his new home, he has his own apartment and rents a much larger space to four different tenants.
Chris Sullivan, a broker with Sullivan Multi Family Realty in Portland, says first-time buyers like Sundberg are on the right track financially.
“It’s how you get wealthy,” Sullivan says. “You have tenants help pay your mortgage.”
Sullivan says that although the multi-unit market has slowed down with the softening of the broader real estate market, he hasn’t seen much of a decline in sales prices in Portland.
“From our standpoint, the higher-end, the nicer stuff, still goes quickly,” Sullivan says. “In Portland and on the peninsula, people are still willing to pay a premium.”
Should you consider a multi?
Sullivan says one of the biggest myths his firm works to dispel is the notion that when you own an apartment building and live in one of the units, you’ll be living rent free. “You’re going to be paying a market rent or a little below market, because of the values in Portland,” Sullivan says.
And while the sales prices may be high in Portland compared to surrounding towns, the city’s role as the region’s economic and entertainment hub translates into a strong pool of potential renters. That’s crucial for new landlords who don’t want to go months trying to fill a vacant apartment.
“We meet with people before taking them out to look at properties and explain that it’s not playing Monopoly,” Sullivan says. “There will be headaches.”
These migraines can range from tripped circuit breakers to boilers that die on a frigid February night. They also can involve renters — who may do anything from paying the rent late to moving out unexpectedly. To be ready for such emergencies, it’s a good idea to have a basic set of do-it-yourself skills, a robust reserve account and a solid team of professionals you can call upon.
“It takes an entrepreneurial personality,” Sullivan says of the ideal multi-unit owner. “It’s like taking on a second job and managing tenants.”
For those not ready to tackle the work of renting, there’s always the option of finding a friend or a family member to buy a multi-unit with you, like Maddie and Anna Soule did. Maddie explained that before making the purchase, the sisters decided what expenses they would split and what they would pay individually. She says they plan to draw up a more formal agreement about things like boyfriends and what happens if one sister wants to move out. But so far, Maddie and Anna have been extremely satisfied with their living situation.
“It’s been great,” Maddie says. “We each have our own space. But we also have someone who we can get together with for dinner, if we want. Or we can both go to our own apartments to watch different TV shows.”
>> Need advice?
Greater Portland Housing Association
This organization of local landlords hosts educational meetings, provides members with updates on changes in Maine rental laws and sends out a newsletter.
FMI call 730-0758 or email gphalandlords@yahoo.com