All Forum Posts by: Account Closed

So what are you gaining by selling?  It seems like you will maybe need to bring money to the table and walk away with nothing.  If you keep it you will have an income earning asset.  What will it cost you to replace it?

I wouldn't put a lot on faith in internet advice.  You also have not given enough information for an informed decision.  But do what you want.  That was your plan from the beginning correct?

No, if you have $200,000 invested and an $18,000 NOI that you can sell for only $180,000 then you only have one cap rate. You HAVE overspent on improvements.

So this property has appreciated about $10,000 a year, $833 a MONTH!  And you return the favor by DUMPING it.  Where is your "better" deal?  Ha Ha  Had you put down 20%, $31,000 you'd be getting 32% back just on the appreciation.

we're sitting here comfortably waiting for some cash faux cheerleader to figger out about the $180,000 cash flow (appreciation) he put in his pocket.

They can purchase for $100,000 and add $100,000 for a rehab and end up with $18,000 NOI but if the market will only pay $180,000 then their cap rate is 10%. Your 9% is not a cap rate.

I'm verklempt!  Talk amongst yourselves, pick a topic.

Exactly!  ALL properties in the same market are going to be the SAME degree of worthwhileness as a rental unless there is a unique detriment to a particular property.

The first thing any investor should do is determine the market values of properties in their target market.  An analysis on one should carry over to all of them.  Now if a seller will not sell at market then it doesn't matter and if you can find a seller to sell below market that will be better but generally no one will sell to you under market unless you are able to solve a problem for him. 

Now nothing wrong with running a lot of "what if" calculations to get used to numbers and calculations but realize they are just practice numbers and calculations. 

Did you pay $104,000?

So if you have a value number by direct sales comparison why on earth are you calculating a cap rate on a SFR that DOESN'T even have a sales price yet? Cap rate is a valuation metric NOT a profit metric. You are spinning your wheels calculating numbers for no reason other than to say they make "sense".

Yes. There are no cap rates on SFR's. If you think so please provide three verifiable cap rate comps for SFR's. If all you are doing is dividing made up NOI's by made up asking prices then you do not get a number that makes any sense.

Are rents generally $1250-$1350 for similar homes in the area?  Do homes in the area generally sell for $80,000?  If so then let's take $1300 X 12 = $15,600  $80,000 normal sales price, divided by $15,600 =5.1 gross rent multiplier.  I would not pay more than 5.1 times the gross rent on another property.  You are using the property you want as a comp based on the sellers numbers.  You want to use the number that other actual buyers used.