Massachusetts multi-family homes weren't such a great investment after all

It seemed like such a perfect idea: rather than buying a single-family home with a picket fence, thousands of New Englanders bought multi-families, living in one unit and renting out the other unit to help pay the mortgage.

But the Associated Press reports that, especially in Massachusetts, things have gone horribly wrong. The benefits of multi-families were overstated, and the prices were bid up by exuberant buyers armed with little equity and gimmicky mortgages.

Now prices are down, the interest rates have reset, and there are more foreclosure petitions than homes sold. Is it a good time to buy multi-families in New England? That depends. If you're buying a multi-family, you have to do the rigorous analysis that too many people fail to do. Will living in a multi-family really be cheaper than a single-family? What are the vacancy rates in your area? And a warning: do not base your calculation on low teaser rates on gimmicky mortgages. Before you even contemplate thinking about thinking about buying a multi-family, read this book.