your gotta kiss a lot of frogs before you find the one

[Jason Malabute]

So I rejected an apartment deal from seller because crime was too high. He sent me another one that he owned. Despite being only 2 blocks away from the original he tried to insist that this one was a B or C (it's not..it's actually closer to the shootings on the crime map). I tried to politely tell him that I was not interested in making offer on 2nd property either, but he kept pushing me to make a hypothetical offer. So I did. I used my mentor's trick of asking the seller what cap rate he thinks it would trade for. I took the annual gross multiplied it by 12% to consider vacancy. I multiplied by 50% to get estimated NOI. I took the projected NOI and divided it by the 6.5% cap rate the seller gave me to get the projected offer price. The seller hung up on me because it was lower than what he expected. I posted this to make a point to never let the seller force you into a deal. I have personally bought a SFH that did not meet my expectations because I put too much trust in my agent. I refuse for that to happen again in multi family investing. Trust your data about the neighborhood you research. Trust your PM, contractor, and mentor. Only proceed with the deal when it actually makes sense to you.