Real Estate Agent · Philadelphia, PA · Member since 2024 · 2 posts · 1 vote
Hey Investors,
I'm Sean Lin, a real estate investor and agent in Philly, and I'm here to share some exciting news and make some connections!
Over the past two months, I've had the pleasure of helping four buyers secure fantastic investments. We've closed deals on three single-family homes, a 12-unit apartment building, and two 3-unit multi-family properties in prime Philly spots like 19147, 19148, 19123, and 19134. These deals were wrapped up in just 30-45 days! By negotiating 20-35% discounts, we managed to achieve cap rates between 9% and 14%.
I've also started managing properties for three of these clients, listing their rentals and ensuring everything runs smoothly. On top of that, six new motivated seller listings in 19134, 19148, 19104, offering even more opportunities for our clients.
Our company has helped hundreds of investors achieve their goals, I'm here to build connections and support fellow investors. If you're curious about the booming Philly market or need some advice, hit me up for a free consultation.
Looking forward to connecting with you all and making some profitable moves together!
Call me a skeptic but I find it hard to believe there are properties trading in 19147, 19148, 19123 or even 19134 at a 14% cap rate. We frequently hear investors chasing properties that meet the "1% rule" which in my opinion is a flawed underwriting practice (have posted on that very subject a few times in these forums), but in order to achieve a 14% cap rate your Gross Operating Income must nearly meet 2% of the assets cost assuming your operating expense ratio is at 35% (which is very lean on operating expenses). At 40% expense ratio which is more realistic you effectively need the Gross Operating Income to equal 2% of the asset price. Normally when you hear cap rates this high the expenses are not calculated correctly or certain expenses are omitted (no vacancy loss, no management fee, light on repairs etc). For illustration purposes:
Hey @Sean Lin welcome to the community! Philadelphia and the surrounding suburbs are a great market to get into. I'll shoot you a PM so we can connect.
Call me a skeptic but I find it hard to believe there are properties trading in 19147, 19148, 19123 or even 19134 at a 14% cap rate. We frequently hear investors chasing properties that meet the "1% rule" which in my opinion is a flawed underwriting practice (have posted on that very subject a few times in these forums), but in order to achieve a 14% cap rate your Gross Operating Income must nearly meet 2% of the assets cost assuming your operating expense ratio is at 35% (which is very lean on operating expenses). At 40% expense ratio which is more realistic you effectively need the Gross Operating Income to equal 2% of the asset price. Normally when you hear cap rates this high the expenses are not calculated correctly or certain expenses are omitted (no vacancy loss, no management fee, light on repairs etc). For illustration purposes:
@Sebastian Bennett Not worth flowing up here. Very few realtors understand how to accurately calculate cap rates and many throw out high cap rate numbers merely to lure In unsophisticated investors who don’t know any better. I suspect that’s what’s going on here. See my post above in this forum which shows the low likelihood the advertised cap rates were actually achieved.