In webinar #3, Charles Roberts analyzes a property he helped a client close yesterday (Yes - yesterday! August 14th, 2017). He uses Joe Massey's spreadsheet to analyze the property. We have a detailed discussion of common investing metrics - cash-on-cash, cap rate, and GRM (gross rent multiplier)
We had great questions from the audience!
- What are the situations where you normally recommend an acceleration clause?
- Do you have an overall average % of income that you use to estimate (i.e.25%) your overall operating expenses (less mortgage)?
- Can you talk about how you prequalify complexes to find out if they're lend-able - owner occupancy rates?
- Are there any building permits needed to convert the open space to a bedroom to charge the increased rent you have mentioned?
- What's a reasonable cash on cash percentage?
- How did you figure out the 5 year after-tax return? And what is a good range for the GRM?
- How often do you re-analyze these metrics and what is your exit strategy and when do you execute it?
- Beginner question...Is it less advantageous to pay cash for investment properties than to finance with 20% down?
- Do you consider what's going in the neighborhood, or whats nearby (good school, highway, park, etc) when considering an investment property?
- If you had to choose, would you prefer to acquire single family or an attached property?
- Denver Investment Property Analysis Spreadsheet download.
- Want to learn more about cap rates and IRR? Read What Every Real Estate Investor Needs to Know About Cash Flow... And 36 Other Key Financial Measures (this is the only real estate book that I've ever read more than once!)
- What is IRR and How Does it Work? - Wonderful explanation!
Looking for an Investment Property?
Good deals are still out there! Watch the webinar and you'll see it. If you questions or want to look at property, give us call and we'll what we can to help you out.