Analyzing apartment complex deals

3 Replies

I’m looking to pick up a large multi family complex. 1. What is an adequate Cap rate for a 14m dollar project? 2. How much earnest should be good consideration for same price project? 3. What are the basic parameters I should consider when purchasing multi family? I’d really like to speak to someone on this matter. Pretty quickly

1. Cap rates depend on property class, location, and general market conditions. Right now in DFW cap rates range between 4.5% for brand new properties and 6.5-7% for C class that needs some work.

2. 1% of the sale price is usual but many buyers offer more and make it nonrefundable from day one.

3. You need to read a few books on the subject. "Buying and Selling Apartment Buildings" by Steve Burges is a good start. 

I’m working on a wholesale contract for a large multi family, and really want to make sure I come across all the correct info. So that I can service my buyers correctly. Thanks for the feed back