All Forum Posts by: Ryan Daigle

@Mary M. nice recovery. Good luck with the acquisition!

@Mary M. was the property already under contract and are you having to renegotiate?

@Jason Malabute all the major spreadsheet apps have formulas for IRR, yes. Don't try and roll that one by hand, it's messy!

Good luck with that 15%-20% IRR target. That implies a fair amount of risk in this market - just be sure you know what you're getting into. Every spreadsheet can be made to say what you want so be sure you're ok with the assumptions that are getting you to that 20% IRR.

Congratulations on getting started on your MFH journey @Brian Alfaro!

The question of whether to hire a coach or not is an age-old one. You're bound to hear lots of different experiences from people that have done both. I think at the end of the day it's going to come down to what kind of learner you are and what value you see in accelerating your path.

Some like to go at their own pace and dig in on their own (as it seems you've done with SFH). Others like the structure and accountability that having a teacher provides. If you know you get more done when you have somebody holding you accountable, then a coach might be right for you.

Additionally, while you can move quickly on your own, having a good coach can definitely accelerate the progress you'd be able to make alone, getting you to your end goal faster. Is that worth $5K to you? $30K? Most of these programs are only as valuable as you make them, so still be prepared for quite a lot of work either way.

There is a middle ground here, which is building out your own network and providing value in the ways you can vs. hiring out. Sounds like you already do a bit of networking so if that's in your wheelhouse then maybe an organically assembled group of coaches is the better route? It all depends on your personality, needs, and goals!

@Evan Polaski great info, thank you! So nobody knows exactly what date the reserves will be returned, but at least we know the logic behind releasing those funds and can model it in.

Yep. Great point @Paul B.

Agreed - so this factor alone seems to indicate that cap rates on the larger assets _has_ to go up unless the further decrease in interest rates is enough to bridge the gap or investors are willing to take lower returns in this environment.

With the new reserve requirements of 12-18 months for Fannie/Freddie loans, how is this affecting your projected returns? That's a lot of capital you have to account for that's not getting a return.

Can you plan to return that capital to after some period of time, or do the agencies require it to remain in place for the life of the loan?

Hi @Ivan Barratt. Love these macroeconomic questions!

I am a short term pessimist, but long term optimist. I do think the asset class will experience devaluation as buyers price in the economic distress of COVID, but as long as the long term demographic fundamentals remain in place, MFH is setup for success so I wouldn't be fearful of a bear trap.

I think an interesting thing to watch is if/how COVID affects any of the demographic trends currently supporting the rise of MFH. For instance, are people less willing to live in high density properties? Does this slow or reverse the move to urban centers? Absent changes at that level I'm a buyer in and coming out of this recession.

@Dan Wentworth great question and glad to see you're looking at the macro factors before diving into the specifics of any one deal.

I find the Yardi Matrix quarterly MSA reports to be the best source of supply/demand information for a specific metro. I also like to download the annual census data to look at population trends. I have a big spreadsheet of that ranked by metros with the greatest growth acceleration if you'd like to take a look. Just DM me. 

Happy hunting!