All Forum Posts by: Elena Coney

@Elena Coney

I don't have the information to calculate COC and/or factor in appreciation. From an agent perspective and myself owning several investment properties, what I am seeing in Tampa is the byer pool getting smaller quicker at the same time the supply pool getting larger because interest rates are causing sellers to panic and "tired landlords" to also want to sell.

With that being said, why not leverage to buy larger multifamily property? One tax bill, one lawn maintenance, one insurance bill, etc. As I always say, marry the home and date the rate. History tells us that rates will drop in the near future and you can always refinance but you can never change the mortgage balance.

What do you mean you have a lack of time for a 1031 exchange? I have examples of people coming to me day of the ID deadline. We got them 3 properties to identify to help them avoid capital gains taxes. We can talk further. 

Is there a reason you didn't consider the 1031 exchange funds in a DST? I've just sold a property and placed our funds with a 1031 Qualified Intermediary. If we can't find suitable properties then investing in a DST is our backup plan.

@Elena Coney

the only reason to buy in cash would be to make some kind of value add play - like buying a property in cash that is only accepting all-cash offers, fix it up, then refi to get your cash back. otherwise your cash is stuck. but having that much is a great way to make aggressive offers with no strings attached. you just need a value add and refi plan - like a BRRRR.

@Elena Coney I’m seeing interest rates around 6% on investment properties with conventional financing. What interest rate are you using to run your numbers? 

That doesn't make sense that the return is the same. Usually a leveraged property provides a much better return. Did you factor in appreciation? 

For example, if you buy a $2m property with your $500k, and the property appreciates 10% over 5 years, the property is now worth $2.2M so the return on your $500k is $200k / $500k which is 40%.

If you paid $500k cash and the property appreciates 10%, that's only $50k and only 10% appreciate.

Then you factor in all the cash flows for the same period to get the total estimated return. 

This is why people use IRR to figure out the total return. Excel has a built in IRR calculator.

And there are a lot of other benefits of multifamily.

@Elena Coney
There is kind of 2 debates there. Multi-family vs SFR and leverage vs cash. Check the forums for previous forums and read previous responses to both. Regarding SFR vs Multi, there are merits to both. Although if the tenant leaves in your single family, you are 100% vacant with a 4 unit if 1 tenant moves, out you are only 25% vacant.