By Thomas Grillo, Globe Correspondent, 4/4/2004
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Keith Servant, 31, and fiance Christine Hunt, 25, recently closed on the sale of this new $309,900 Colonial in Rutland - after they did a complete walk-through of the property.
Sales of multifamily homes set a record in Massachusetts last year, fueled by first-time buyers priced out of the single-family market and investors seeking refuge from the stock market, according to the Massachusetts Association of Realtors.
"Even with the low interest rates, buying a multifamily is the only way many families can afford to become homeowners," said John Jannino, of Re/Max Heritage in Melrose.In 2003, a total of 8,088 two- three- and four-family homes were sold in Massachusetts, compared to 7,481 in 2002 -- an 8.1 percent increase and the largest gain in multifamily home sales in four years. The average price of a two- to four-family home reached $290,654 last year, up 3.9 percent from $279,601 in 2002. In contrast, the average price for a single-family home was $373,437 last year, a 7.9 percent increase above the record of $346,019, set in 2002. Still, being a landlord is not for everyone. Dawna Provost-Carrette said she inherited a tenant from a previous owner who refused to pay rent for months when she bought her four-family in Cambridge. "If you have good tenants you're golden," she said. "But if you get people who are loud, refuse to pay the rent or use substances, that's a major bummer, because Massachusetts laws favor tenants." Provost-Carrette, a member of the Small Property Owners Association, suggests that landlords run credit and background checks on prospective tenants, verify employment, and call at least two previous landlords as a precaution. Insurance can be another factor to consider when buying a multifamily. James Harrington, executive director of the Massachusetts Insurance Federation, said that safe, well-maintained properties generally are not difficult to insure. Securing insurance is more challenging in coastal communities, though, as it is when the home is in disrepair or has a flat roof that could collapse under heavy snow. The Massachusetts Property Insurance Underwriting Association, also known as the FAIR Plan, was established by the Legislature to provide property insurance for applicants unable to get it on the open market, he noted. Buyers who hope to convert apartments to condominiums should check local regulations, which could be more demanding than state law, which requires owners to provide at least two years' notice to tenants and to pay moving expenses. Boston's condo-conversion ordinance requires a five-year notice for tenants who are elderly, disabled, or of low or moderate income.