The definition of the terms NOI, DCR, and Cap Rate are deceptively simple! You are unlocking the secrets of their interaction. I very much appreciate your warnings here.
Thank you Mr Harris for your detailed expiation of this topic on commercial real estate.I am learning a lot here. Thanks to the producer of your program.
Hey Peter. Theres something i dont fully understand about number 2. What i understood about number 2 is that your exit cap rate is the market cap rate. Does that mean you have to sell the property at the market cap rate, even though there may be differences between the property's?
Because financing terms can very greatly for different investors. NOI is calculated without debt service to be able to compare properties on a level playing field, so to speak.
HAPPY BELATED BDAY! I love your videos, man! I'm having a problem finding the cap rate for my current commercial multifamily property now that I'm trying to cash out refinance. The real estate agents don't seem to help much. Where can I get an accurate cap rate? I've increased the NOI by $12k the first year but can not really compare it to anything, considering the previous owner/occupant self managed and did not keep good records.
Happy birthday! I’m curious if you’ve ever experienced a 2.0 + on DCR? I’m an accountant so I don’t like a lot of risk. I’d like at least two times or more positive NOI.
Trained well.. every corner has different so you go out to have different strategies you know what your your analogy is so right. If the math doesn't work the engineer build your car wrong you can get in a wreck. In real estate you're in a wreck if you're over your head and there's and you've gone by blindly in and and don't do your due diligence you're in trouble so. Yes I agree with that at least on the bigger picture. I like my investment that I'm looking at but some of the strategy and some of the math is Missy. So I could be in little danger if I move forward. Specially when something's overpriced and yeah I know about risk factor. But I've come out okay. Perhaps it's something I need to hear so I don't go overboard. Do not move forward until you have identified in any risk factor. Debt coverage ratio. Does this property cover the loan amount. Or is there a deficit and is there anything left over for expenses annual net operating income/
Risk Factor #2: Doesn't the market cap rate change over time in any given area? That being said, how can I know what the market cap rate will be 5/10 years from today? This all depends on where the neighborhood will be in terms of real estate value growth or decline. A high cap rate often means that the neighborhood isn't terrific, you are renting rooms in your building, or you simply got a terrific deal when you purchased the building and added value.
I'm confuse with the Number 2 why in 5 yrs the NOI is 50K and the Mkt cap rate is 5 % it give you $1,000000 but in the same 5 Yrs the NOI is 50K but the MKT cap rate is 7% it give you only $714.000 Thank You!! for your great videos!!
higher cap rate indicates lower selling price at that point in time. lower cap rate rate indicates a higher selling price at that point in time. You want to try purchase a property at a higher cap rate then sell at a lower cap rate.
Mitigate risk investing in commercial real estate by applying to our Protege Program: www.commercialpropertyadvisors.com/protege-program
A simple video that worth millions of DOLLARS. Thanks Peter.
Man this guy is an incredible teacher.
The definition of the terms NOI, DCR, and Cap Rate are deceptively simple! You are unlocking the secrets of their interaction. I very much appreciate your warnings here.
Thank you Mr Harris for your detailed expiation of this topic on commercial real estate.I am learning a lot here. Thanks to the producer of your program.
Peter is phenomenal.
Another great video Peter! You're so informative. I hope to enter your mentorship program soon!👍🏾
Some of the best content on the internet!! Keep up the great work!
I'm learning so much, Peter! Thank you for your practical approach-I'm looking forward to becoming a Student of yours!
Happy birthday Peter!!🎉🎉
Looking forward to working with you.🤗🤗
Another great video!!!😊
Thank you 🤗
You are an excellent teacher! I can’t wait to take your course. Thank you for all the great videos you put out!
Hey Peter. Theres something i dont fully understand about number 2. What i understood about number 2 is that your exit cap rate is the market cap rate. Does that mean you have to sell the property at the market cap rate, even though there may be differences between the property's?
Happy birthday.
Great advice as always
How would you predict market cap rate 5 yrs out?
Happy belated Birthday Peter!
Peter,
HELP!!
I fail to understand how one can know the EXIT CAP-RATE.
To me it seem that sort of a projection will be tough to quantify.
Love this channel!
Great video, thanks!
Congratulations.
Thanks for the great information
Happy belated Birthday!
Why doesn’t the NOI come AFTER you deduct mortgage payment?
Because financing terms can very greatly for different investors. NOI is calculated without debt service to be able to compare properties on a level playing field, so to speak.
HAPPY BELATED BDAY! I love your videos, man! I'm having a problem finding the cap rate for my current commercial multifamily property now that I'm trying to cash out refinance. The real estate agents don't seem to help much. Where can I get an accurate cap rate? I've increased the NOI by $12k the first year but can not really compare it to anything, considering the previous owner/occupant self managed and did not keep good records.
Just look at the CAP rate for commercial properties on sale near where your property is.
Call a local broker. They generally will be happy to give you that information and you also have them as a source in the future.
How to calculate exit cap rate ?
Happy birthday! I’m curious if you’ve ever experienced a 2.0 + on DCR? I’m an accountant so I don’t like a lot of risk. I’d like at least two times or more positive NOI.
Excellent point! I always like to see double the rents/mortgage amount to charge tenants.
@@charlesstokes6138 more risky/dangerous neighborhoods?
Put more money down when you purchase to reduce your mortgage payments if you are that concerned.
@@Parpl22 I would hold as much of my cash as possible to invest in other deals but I see your point .
Good video. What types of services does CPA offer? I calculated 1 and 3 for my property to see where I landed.
Learn more here: www.commercialpropertyadvisors.com/protege-protege
Trained well.. every corner has different so you go out to have different strategies you know what your your analogy is so right. If the math doesn't work the engineer build your car wrong you can get in a wreck. In real estate you're in a wreck if you're over your head and there's and you've gone by blindly in and and don't do your due diligence you're in trouble so. Yes I agree with that at least on the bigger picture. I like my investment that I'm looking at but some of the strategy and some of the math is Missy. So I could be in little danger if I move forward. Specially when something's overpriced and yeah I know about risk factor. But I've come out okay. Perhaps it's something I need to hear so I don't go overboard. Do not move forward until you have identified in any risk factor. Debt coverage ratio. Does this property cover the loan amount. Or is there a deficit and is there anything left over for expenses annual net operating income/
Is there a spreadsheet or app for that?
Absolutely love the content! Thanks for giving this wealth of information that I will apply!
Great video 👍🏼
Do you advise commercials real estate owners to hold property over 20 years?
Depends on how well the property continues to perform over that period of time relative to other opportunities that may be presented to you
How can we know the market cap rate 5 years ahead of time Peter?
I have the same question, thank you.
Risk Factor #2: Doesn't the market cap rate change over time in any given area? That being said, how can I know what the market cap rate will be 5/10 years from today? This all depends on where the neighborhood will be in terms of real estate value growth or decline. A high cap rate often means that the neighborhood isn't terrific, you are renting rooms in your building, or you simply got a terrific deal when you purchased the building and added value.
I have the exact same question.
That’s the major challenge analysts sit around trying to figure out all day for large syndicators.
I'm confuse with the Number 2 why in 5 yrs the NOI is 50K and the Mkt cap rate is 5 % it give you $1,000000 but
in the same 5 Yrs the NOI is 50K but the MKT cap rate is 7% it give you only $714.000
Thank You!! for your great videos!!
higher cap rate indicates lower selling price at that point in time. lower cap rate rate indicates a higher selling price at that point in time. You want to try purchase a property at a higher cap rate then sell at a lower cap rate.
Happy Birthday🎉🎈🎁🎂
Need to be ready to look in a contract.
Love your viddos
Thank you so much!
@@CommercialPropertyAdvisors do you do coaching?
@@KarlBreaux Absolutely! Learn more here: www.commercialpropertyadvisors.com/protege-program
Happy born king mr.harris
yes
Good !
Happy birthday 🎉
Happy birthday
Land lord you haven't pay rent in six months baby😆
Happy belated Birthday!