Estimating Future Value With Cap Rates
Forced appreciation is one of the biggest opportunities i see in MF over SF, but i don't know if i am thinking about this the correct way.
If I am buying a $21,620 revenue stream for $239,000 (9 cap), with an investment of $80,000 i improve and stabilize the asset through a section 8 re-positioning, shouldn't i then be able to and sell a new and improved $36,208 revenue stream for for $439,911 in 12-18 months. (9 cap)
Hypothetically, would a better looking, managed and performing asset be able to get an 8% cap rate? Assuming so the value would be $452,600?