Skip to content
×
Pro Members Get
Full Access!
Get off the sidelines and take action in real estate investing with BiggerPockets Pro. Our comprehensive suite of tools and resources minimize mistakes, support informed decisions, and propel you to success.
Advanced networking features
Market and Deal Finder tools
Property analysis calculators
Landlord Command Center
ANNUAL Save 16%
$32.50 /mo
$390 billed annualy
MONTHLY
$39 /mo
billed monthly
7 day free trial. Cancel anytime
×
Take Your Forum Experience
to the Next Level
Create a free account and join over 3 million investors sharing
their journeys and helping each other succeed.
Use your real name
By signing up, you indicate that you agree to the BiggerPockets Terms & Conditions.
Already a member?  Login here
General Real Estate Investing
All Forum Categories
Followed Discussions
Followed Categories
Followed People
Followed Locations
Market News & Data
General Info
Real Estate Strategies
Landlording & Rental Properties
Real Estate Professionals
Financial, Tax, & Legal
Real Estate Classifieds
Reviews & Feedback

Updated over 4 years ago on . Most recent reply

User Stats

4
Posts
0
Votes
James Farrior
0
Votes |
4
Posts

Help with assessing a project - internal rate of return

James Farrior
Posted

Hello,

I'm looking at putting together my first project - a multifamily in Houston. I ran the numbers and came up with a 17% IRR and a 7% cap rate over a 20 year horizon. I'm trying to understand whether this project is superior to putting my capital in the stock market (which I'm assuming will return 7%). I understand the math behind the IRR number (setting NPV equal to 0) but I'm having trouble capturing the intution of how to compare that to stock market returns. Also I know that investors generally want a cap rate of 8-12%, but I think that may be arbitrary. Could someone please help me figure out how to interpret these nubmers (as oposed to putting my money in the stock market)? Thanks.

Loading replies...