Determine Value of an Apartment Complex

[Zoltan Kalu]

Hi everyone,

I would like to know, how can I find out the value of multi family properties. Find out ARV of a single family house with similar, sold properties in the area, is understandable, but it's not easy to find similar, sold 10 unit apartment complexes in the area.

My question is that, what is the best way to determine the value of a 10 unit apartment complex?

Thanks for all the help.

[Alina Trigub]

@Zoltan Kalu

When it comes to commercial multifamily, (5 units plus), the value is determined based on the NOI. The NOI in turn is sales price over the cap rate. So you need to find out what the going cap rate for the area (either through a broker if you have one or by asking around other investors locally).