The 1% Rule for Multifamilies

[Roemeo Barnette]

What’s going on BP!

I have a question for my fellow investors.

Do you live by the 1% rule when investing in Multifamilies?

I’m asking this question because we know the 1% rule is for a GREAT DEAL! But what makes a GOOD DEAL to you percentage wise ? When you are analyzing a property and your market rents are below 1% of the price per unit do you walk away ?

[Anthony Wick]

i analyze properties based on current rents. I chuckle at the pro forma some real estate agents put out. Oh, I could get up to 1% if I raise the rents to market value? Ummmm, no thanks. Here's your offer based upon what the rents currently are, and then hopefully I can squeeze out more profit after I close and in the future. I'm not taking a chance of losing money for months on end while I wait for the current leases to expire.