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Multi family simply means the property has more than one living unit (duplex or above). Usually this means separate utility meters and will be sold as real estate that can be rented out to multiple families. A home with a guest house on the property is generally not considered multi-family. Remember that if you are looking on purchasing a multi-family property a standard residential mortgage will only apply for up to 4 units. Once the number goes above 4 the buyer will need to get commercial financing.
Definition of Multi-Family. A type of home or building with multiple units owned by one or more parties. Condo buildings and duplexes can be considered multi-family residences; but with a duplex, both the property and the land are recorded on one deed. Whereas with a condo, the owners own their individual units and have a tenancy in common with all of the owners in the complex for the shared space.