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Updated almost 11 years ago on . Most recent reply

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David McEwan
  • Real Estate Investor
  • Fort Lauderdale, FL
8
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40
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What determines a "GO"?

David McEwan
  • Real Estate Investor
  • Fort Lauderdale, FL
Posted

Hey BP family, 

Just a few questions I'm running into in my over priced south Florida market.

What determines if a property is actually a good investment? 1-2% rule, Cap, etc?

What if it doesn't make the 1-2% rule but has a good ROI or Cap, etc?

Most Popular Reply

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Jean Bolger
  • Aurora, CO
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Jean Bolger
  • Aurora, CO
Replied

That's going to be a really hard question to answer, I'm afraid. There are so many variables, not the least of which is where you are in your investing career and what's going on in the rest of your financial life. And your personality and level of risk acceptance.

For instance, if you're just starting out, some would say keep it super safe, go for a conservative return on a property that needs next to nothing and has looks to be very low maintenance going forward. Others would lean towards a property that needs tons of work that you could get for way under market, figuring that if you don't make high returns at the start you'll never have enough profit and momentum to build your business.

Both of those could be considered "good investments" for different people at different times.

I know that reading about other people's deals and business approaches here on BP helped me open my mind to some different possibilities and helped me develop a set of standards that work for me (for now). It also convinced me to take my investing out of my local market. Others here swear that there are deals in every market, you just need the skills to find them. I am hoping that both approaches are correct! Ask me in a few years...

  • Jean Bolger
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