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Would it be okay to ask as to what books you have read? If possible just pm me if you don't want to state the books publically.Most of what I learned about investing in apartments came from two books. It seems that combined, they would make a lot of sense and be benefitial to others. But, I like to golf and workout. There are still investments to be made. I would have to sacrifice something.
We can focus on reading MJ's book. I would enjoy seeing the content as we have taken very different paths.
and perhaps you can share your wisdom on the matter.
The books that I learned from are old but still relevant. The examples would be using outdated numbers though.Would it be okay to ask as to what books you have read? If possible just pm me if you don't want to state the books publically.
I understand you gain nothing from sharing information but I would love to learn more about it all. I broker deals, usually for large quantities of items and have become aware of a coal-mine being sold in North America. I do not believe you have had experience in something like this, but I would consider it "real estate"
The client I have can either buy the coal monthly for his requested 5 year contract (how they originally approached me) or (and as I suggested), the organization should buy their own coal mine, outsource development and mining and ensure themselves a great supply of coal about 50x more than what they are going to pay for-for 5 years, when they can just buy the coal mine entirely at the price of the 5 year coal contract quantity and ensure themselves greatly. (Not sure if this makes sense.)
Any insights/thoughts etc would be greatly appreciated.
Thank you for reading @SteveO
From iAmTrade
Eagerly awaiting a reply even if a negative one towards me.
You could say again the numbers have changed...lol
When it comes to selling- and in my experience- price is the easiest thing to manipulate, by using things you can't change to manipulate it.You could say again the numbers have changed...lol
I just evaluated a deal in at best a secondary market in mid-West yesterday. My strike was plus or minus $7 mil. Called the broker - the seller wants $10 mil +. And you know what - they'll more than likely get very close in today's market. So - question:
Is there no rationale in this marketplace, or is there rationale but it is totally different from mine? I have my own opinions, as you know...
Ha - the problem is that as a buyer I know how much shit costs. There's no magic to running apartments - most costs are fixed to a great extent. Therefore, my price is reflective of my projections of what the dynamics will be - the trailing pro forma matters but not for underwriting the financials.When it comes to selling- and in my experience- price is the easiest thing to manipulate, by using things you can't change to manipulate it.
Find what the buyer secretly wants- and they'll hand over the $ for it. Price is "never" the issue, look into Grant Cardone's teachings
But you already said it yourself... this is a crazy market and prices are not reflecting real operation cost but perceived potential appreciation.
In multifamily space the current high prices have less to do with potential future appreciation and more with the underlying need for big money (which is leverages at really cheap cost) to achieve yield - any yield. The current buyers are buying the delta between the Cap Rates and the cost of debt. In this environment, when Fannie 10-year non-recourse debt is 4.5%, institutional money figures that buying at a 7 Cap get's them 2.5% delta in yield.
I agree with you. I stopped believing in CAP rates long time ago. What a waste of time and energy.
Just curious, what are your sources for funding deals then?
Oh, I still believe in Cap Rates, just not the way most people do
Oh, I still believe in Cap Rates, just not the way most people do
And, for small deals I use portfolio notes with private money. Bigger deals (syndications) - private placements
Oh I can get 7.5%- 8% on a 5-year balloon pretty easily if need-be. There might be some amount of escalations. At this point I will only do that if it's a screaming deal that can't be passed upon, since I don't really want to be in a 5-year balloon unless totally necessary. But, the money is available...
Ask way
Cap rates are a load of crap in most locations. The only cap rates that matter are the ones that you make from your own numbers. This is consistent with what Ben is stating. But @andviv is also correct that you cannot go out shopping for apartments based on cap rates. The numbers being used for comparison are out of calibration on ALL angles.
It doesn't even matter what the pro forma is. We know what shit cost
Deep digging! Don't you have a desert your jeep should be on?
Heading to moab soon... with a stop to visit @biophaseDeep digging! Don't you have a desert your jeep should be on?
We are headed to Cripple Creek next week. I got see your area for the RV in Mt Crested Butte. Beautiful place.
Ha! Very busy these days.@SteveO
When are you going to develop that land in Utah with a nice scenic nook and write that book? I think it is time, what is your info so I can send money for my preorder
I read this and thought to myself, "a legend is born".
Then I saw your legend preceeded you...
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