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Unbelievable 60% Cash Out Refinance during this Economy by Achieve

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james kandasamy austin

Dear Achieve Investment Group community, We are excited to share some great news with you! We have just achieved a 60% cash-out refinance of University Cove Apartments at an impressive 4.83% interest rate. This means that 45% of the cash-out will be distributed to our investors, while the remaining 15% will be set aside as a reserve. In just two years, we have increased the net operating income (NOI) of the property by an incredible 250%. This is a testament to our strong asset management skills, and our ability to approach deals like sharpshooters. It is especially impressive given the current challenging economic climate, where we have seen capital calls, foreclosures, and stop distribution events. Executing this refinance was no easy feat, particularly given the volatility in interest rates and our deadline of April 3rd, 2023 – the day 2023 property taxes were due. However, thanks to our new mortgage rate AI tool, we were able to successfully complete the deal. Quick decision-making got us this unbelievable deal! We put this deal under contract in three days. On day one I heard from the broker, on the second day I drove by it, and on the third day, we were under contract. Quick execution comes with years of experience, we were able to estimate rehab estimates, just by driving by and confident in moving forward with the contract. Many other groups were chasing the same deal but stu必利勁 ck with the NOI being upside down. This property was going downhill on forbearance during Covid, and we turned it around achieving great success. This is what you get with experience operators! We want to congratulate all our investors on this fantastic outcome. We believe that this is a testament to our commitment to creating new opportunities and achieving growth in challenging times. Get a Free Copy of my #1 Best-Seller Passive Investing In Commercial Real Estate GET IT NOW With an ongoing economic slowdown that’s cooling investment nationwide, one of the country’s most active housing markets is ready for its test. While Austin is well positioned to weather what’s ahead, caution is still advised. Read More

Real Estate Insights: Analyzing the Apartment Market Cycle with Glenn Mueller’s Report

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As the economy continues to recover from the pandemic, the real estate market is experiencing some interesting shifts. One area that has been closely monitored is the apartment market. Glenn Mueller, a real estate professor at the University of Denver, has released his latest forecast on where apartments stand in the market cycle. According to Mueller’s report, apartment occupancies are expected to be flat at peak-equilibrium levels in the first quarter of 2023. However, there will be a slight year-over-year decrease of -0.3%. This is due to a new space supply boom in 2022 that is pushing occupancies down in many of the fast-growing second-tier markets. Mueller predicts that 14 markets will be in the hype supply phase of the cycle by 1Q23. This is a result of the strong supply response of the economy re-opening. Although demand growth is expected to settle back down to the more long-term average of 75,000 units per quarter, the national apartment asking rental rate is expected to increase by 2.3% in 1Q23. This increase is higher than the 12.3% experienced in 2021. Mueller forecasts that the national apartment asking rental rate will be up 15.9% year-over-year. It is important to note that the 10 largest apartment markets make up 50% of the total square footage of apartment space monitored by Mueller. These markets include New York, Los Angeles, Chicago, Dallas, and Houston, among others. Mueller predicts that the weighted national average will be affected by these markets. Overall, Mueller’s forecast provides valuable insights into where apartments stand in the market cycle. The hype supply phase in many second-tier markets may lead to lower occupancies, but the national apartment asking rental rate is expected to increase. Real estate investors and professionals should take note of these trends and adjust their strategies accordingly.

Hotel to Multifamily Conversion

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Welcome to the second part of our Hotel to Multifamily Conversion series by James Kandasamy. In our last episode, we discussed the acquisition process of Salado Creek Apartments, which had initially been a hotel. Today, we bring you part two of our conversion journey. As a start after our purchase, we started with landscaping where Our team worked tirelessly to trim the trees and shrubs around the property. The hotel had deferred maintenance for a long time and it was worst during COVID. The process almost took 10 days to complete. We need a clean and well-manicured environment to attract good residents for our future multifamily. We also did some creative things with the multifamily conversion process. We tweaked 130 units from hotel to multifamily efficiency units. Since it’s a requirement to have closets in multifamily units, we modified an open space to an “open” closet. The toilet had a small door due to an older grandfathered-in code. We decided to add a “barn” door to save space to it. We decided to leave the PTAC instead of changing it to multifamily HVAC units as it’s not really needed. These are some of the creative ideas that we decided to do during the conversion process. At that time of the takeover, the occupancy rate stood at 9%, but we were confident that with the changes will be attractive to residents on a 12 months lease (instead of daily occupied units in the Hotel). The next part will focus on painting the exteriors and the importance of doing it as a part of the value-add. We are excited to continue this journey and cannot wait to see the final product. Stay tuned for our next episode, where we will share our progress with you. Watch Part Two

US Banks Sitting On Billions of Losses!

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Moody’s Investors Service has initiated a review for possible downgrade of First Republic Bank and five other US lenders, indicating growing apprehension about the stability of regional financial institutions after the collapse of Silicon Valley Bank. – K.C. Conway, Commercial Real Estate Economist and Futurist The other lenders placed on review are Western Alliance Bancorp., Intrust Financial Corp., UMB Financial Corp., Zions Bancorp., and Comerica Inc. Moody’s decision was influenced by worries about the lenders’ dependence on uninsured deposit funding and the potential for unrealized losses in their asset portfolios.   Source: Russell Ward FTX and Silver Gate in TX, followed by SVB bank, have been deemed a total failure by both the Fed and bank regulators. They failed at their primary job by failing to anticipate the unintended consequences of the steepest and quickest interest rate increase in history. Additionally, there is a concentration risk failure by allowing the tech industry to become concentrated in a single bank, which is surprising considering the lessons learned after the 2009 financial crisis. It is puzzling why the Fed would allow this to happen in the tech industry but not in larger corporations such as P&G, GM, Ford, Tesla, etc… In light of the unintended consequences of rapid and successive interest rate hikes, it is unclear if inflation can remain the Fed’s central focus. There are no clear answers to these questions, and with the Fed’s FOMC meeting scheduled for next week, there is a greater than 50% chance of scaring the market even further. Only time will tell how this situation unfolds, and businesses will need to scramble to find ways to secure capital and determine where to invest their cash. With this backdrop, it is unlikely that any kind of CRE lending activity will occur. But, we want to take this opportunity to inform you that you can continue to have confidence in Achieve Investment Group. Our firm has ZERO exposure to Silicon Valley Bank, Signature Bank, First Republic Bank, and additionally stressed banks. Our risk management team has taken the necessary steps to ensure that your investments are protected, and we are continuously monitoring the market to adjust our strategies as needed. Our team of experienced professionals is constantly monitoring the market and making informed investment decisions on behalf of our clients. We believe that our disciplined approach and focus on long-term value creation will continue to serve our clients well, even in uncertain market conditions. Subscribe to our weekly newsletter to stay current with the updates. Join us for a Live Webinar “Passive Real Estate Investors Need To Know This Before Filing Their 2022 Taxes – Essential Tax Planning Tips And Strategies Before April 15th” With nationally recognized CPAs And Tax Strategists Amanda Han and Matt Macfarland. REGISTER FOR FREE Have You Missed Out On This Week’s “Multifamily Quick Hits?”   SUBSCRIBE TO OUR YOUTUBE CHANNEL

How We Created 6 Passive Investor Millionaires In 2022?

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Passive Investor

Passive Income Millionaire Is Not A MYTH! Although not crashing like stocks or crypto, Commercial real estate is definitely slowing down and decreasing in value. It’s important to invest alongside an experienced operator, that has “Skin In The Game”. Here’s How We Countered The Market Volatility With Our Knowledge & Experience:- We sold 50% of our assets in 2022. Six Passive Investors Became Millionaires After The Sale Of Our Six Assets. Two were from Houston, one from Austin, and three were from San Antonio. All of them chose to Achieve Investment Group as their primary operator and invested heavily. Almost all tried diversifying for the initial two years of their investment learning period. However, after two years they realized that it was better to invest with a few “alpha” operators rather than diversify. They were extraordinarily successful. It is possible to earn more than a million dollars in three to five years without working at all. Passive investing is an elegant strategy for creating wealth. A majority of them are W2 employees who invested an average of $100,000 in each deal. They also invested heavily in deep value-add deals, which Achieve was very good at. These were based on their own personal investment life cycle—a concept discussed in Chapter 2 of my best-selling book. They took the bet, and they won big.

3200-Units Foreclosure Key Takeaways for Operators and Passive Investors

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Passive Investors from Houston Multifamily Foreclosure As the whole Multifamily Industry knows, there was a foreclosure of 3200 Units with $229 million of debt in Houston by Arbor Realty from a private Deal Sponsor from Dallas. These properties were bought between August 2021 and April 2022. The Deal Sponsor defaulted on their mortgage payment. The investors from that deal have alerted their friends about the potential foreclosure two weeks before it came out on Twitter . This news eventually came out in Wall Street Journal.  As per Trepp Inc, these properties’ cash flow went from 3.8% to more than 8% due to the rapid interest rate hike by FED. While the interest rate hike by the Fed has caused this property to be further under distress, many other factors have caused these Deal Sponsors to face foreclosure. We have a written 10-series article that we wrote so that any passive investor can learn and avoid investing in this kind of Deal Sponsors. Bridge Loan with No Rate Caps As per the chart below from Howard Mark’s book “The Most Important Thing”, Non-Recourse Bridge Loan stacked with Preferred equity without a rate cap.   As you can see it’s considered the highest risk deal type. Preferred equity is a private institutional group that acts like a lender but holds a second position in the capital stack. Preferred equity usually charges a fixed 12-14% interest rate with 1%-2% when the deal is initiated and exited. Usually, preferred equity is used behind common equity (normal retail investors) to boost back-end profit. It’s also used when the sponsor can’t raise a large sum of equity from retail investors. The pitch to the investor is the deal has a lot f upside that even after paying the fixed return to the pref equity group, there will be a lot more upside to common equity.  I attended a webinar where the presenter declared using preferred equity is the way to do deals in 2021. To survive market fluctuations an operator needs to be disciplined and stick to their stringent underwriting criteria. However, when the buying spree seems to be forever, many operators start to do deals at any cost. This includes taking Bridge loans for a deal that does not have significant value-add. I call it a misuse of loan type. I see many cash-flowing deals with thin upsides were bought using bridge loans. Of course, when the Deal sponsor raises the capital, they declare their deals are value add. The question is how big is the upside? In the worst case, some Deal Sponsors did not even take a rate cap insurance.  After the year 2020 to mid-2022, the value of the multifamily assets has gone beyond its intrinsic value. Fannie Mae and Freddie Mac lenders have almost gone out of business as the only way to make any deal work is to get a bridge loan since it’s a forward-looking upside loan. Furthermore, many Deal sponsors didn’t realize that the rate is variable. When the interest rate skyrockets, most of them are caught unprepared. The smarter and more conservative one invested in rate caps insurance since it was affordable then. The aggressive or less sophisticated Deal Sponsors decided not to buy rate caps due to ignorance or they even can’t raise the capital for equity. Most lenders will require rate cap purchases as a mandatory requirement. In the Houston Foreclosure case, looks like the lender didn’t require the sponsors to buy rate caps. Furthermore, Bridge loans were used for Deals that is not for value add. At Achieve Investment Group, James Kandasamy Texas, we are proud to say that we only have 1 bridge loan (with a rate cap of course) out of our 15 multifamily deals that we have and have done. Even that bridge loan is a true Deep value add deal. We could have done many more deals from 2020 to 2022 by taking Bridge Loans for all kinds of think upside deals as many passive investor capital were easily available. We were well aware that Bridge loans pose risk and need to be used appropriately for true-value add deals. I wrote about this on page 68 of my 2019 Bestselling Book “Passive Investing in Commercial Estate”.    Action Item for Passive Investors For passive investors, it is important to consider passive real estate investing as a potential option, Make a list of your investment to identify bridge loans, whether there are rate caps, when the rate cap expires, and whether the deal has a preferred equity between You (common equity) and the Senior Lender. I am sure you will be surprised! 

AI Investment Tools: Game-Changing Solutions for Real Estate Investors

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Artificial intelligence (AI) technology is now playing a pivotal role in transforming the multifamily housing market. This cutting-edge technology is improving efficiency, maximizing investor returns, reducing costs, and enhancing the overall tenant experience. As such, AI technology is changing the game for Real Estate Investors , passive investors, deal sponsors and operators as well as developers designing and constructing new community developments. Bear in mind, we have no relationship or conflict of interest in presenting these tools, they are simply programs we have witnessed emerging in the space and certainly new AI tools are coming online daily. Your own due diligence in use of any of these tools is advised. CONSTRUCTION AND DEVELOPMENT In construction and development, AI is improving efficiency by streamlining processes such as scheduling, budgeting, and project management. AI-powered construction management platforms such as Smartvid.IO provide easy access to critical insights, enabling developers to make more informed decisions and avoid potential delays. Another type of tool to expect more of is automated design and planning based on tracts of land, and what can be built. Should you build single-unit and ground floor only? Where might parking lots fit? Instead of replacing architects, these technologies can augment efforts and help move projects along faster with inspiration. For instance, one such tool is called ArchiGAN, which is a generative stack for apartment building designs. LEGAL AI technology is also changing the legal landscape for real estate. AI-powered legal services can help property owners and investors streamline their legal documents, such as leases, purchase agreements, and legal due diligence. Newly trained LLMs can even pass the Bar exam, and as an example, “DoNotPay” claims itself as “The World’s First Robot Lawyer”.  As a matter of fact, if you are searching for “Best AI Legal Tools 2023”, you will find an emerging industry that can save you money but should not replace your human legal team. However, services such as AI-powered contract review platform LawGeex allow legal teams to spend more time on higher-level work, reducing the time and cost of legal services. Again, for clarification, people and organizations should always consult with a qualified attorney before making decisions based on the information in this post or using any of the tools referenced herein. ANALYSIS AND DECISION MAKING AI technology makes it possible to leverage large amounts of data to gain insights that can inform decision-making. Investing in AI-powered tools like Google’s TensorFlow can provide data-driven insights that can direct decision-making related to rent pricing, marketing strategy, and property operations. Another example is Cody, an AI assistant. Cody is an intelligent AI assistant like ChatGPT, Bard, or GPT4 – with the added benefit of being able to train it on your business, your team, your processes, and your clients with your own knowledge base. Use Cody to support your team, answer questions, help with creative work, troubleshoot issues, and brainstorm ideas. RESEARCH AI is also revolutionizing the research process in the multifamily housing market. AI-powered tools such as AssetSonar can gather and analyze a broad range of data on properties and neighborhoods, including zoning and demographic data. These tools provide investors, operators, and developers accurate and up-to-date information that informs their investments and development decisions. One such example is turning your PDFs into chatbots, then simply asking your PDF questions to get answers summarized and delivered instantly. Some tools you might try are PDF Analyzer, ChattyPDF, or Ask Your PDF. For instance, why scour for details about K1’s when you can let a chatbot explain the intricate details in a simplified, quickly understood format? Or, simply use it for effortless organization and watch your document transform into a structured outline automatically. MARKETING AI technology also plays a significant role in the marketing of multifamily housing offerings. AI-powered chatbots can provide an excellent tenant experience, provide 24/7 support, and answer tenant questions. AI-powered chatbots and tools such as Rentlytics can provide insights into the customer journey and help operators identify the most effective marketing channels. When it comes to executing marketing strategies that include graphics, audio, video, social media and more, it is actually difficult to keep up with so many tools coming online. Every day there are more and more powerful tools, and considering some like Adobe are trained on LLMs that feature copyright protected libraries, it is worth considering where your tools are pulling their “influence” from so you don’t end up drawing off scraped and protected art that can come back to you such as copyrighted works, fonts, etc. LEASING AI technology streamlines the leasing process by reducing the workload of property managers and leasing agents. AI-powered leasing tools such as Leasera reduce friction such as application processes and digital approvals, speeding up the leasing process. AI algorithms can analyze vast amounts of data to develop scoring for tenant applications, even conversing with potential new applicants via chatbots and SMS to ‘nurture’ them along as leads, such as LEA, the AI leasing agent. PROPERTY MANAGEMENT (PROPTECH) AI-powered property management systems can help property managers automate tasks such as maintenance requests and payment bills. Platforms like CBRE provide built-in AI-powered chatbots that can help reduce tenant turnover rates. Property management systems powered by AI such as Rentigo generate automated rent payment reminders to help ensure on-time rent payment by tenants leading to reduced late payments and better cash flow management for property managers. Another way to use it is implementing communications tools such as Fathom, which plugs into ZOOM, Google Meetings, Microsoft Teams and other video platforms to annotate meetings, create transcripts, and even summarize meetings with different speakers noted and highlighted meeting points of importance. Look for more multifamily Proptech tools using AI to: Manage your real estate portfolio Organize your rental property operations Manage rent rolls and finances Manage leases and affordability compliance Communicate effectively with tenants, managers, and investors MORE MORE MORE! There are just so many AI tools coming online, multifamily operators need to experiment and see what will work best for themselves.  In multifamily … Read more

The Investment Outlook For Multifamily Properties In 2023

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Multifamily Properties In 2023 The multifamily property market has been one of the most resilient sectors in real estate, even through economic downturns. However, with the current economic climate, there are concerns about the investment outlook for multifamily properties in 2023. Interest rate hikes, bank failures, and lower returns are all factors that could potentially impact the market. In this blog, we will explore the investment outlook for multifamily properties in 2023, including the trends, challenges, and opportunities that investors should be aware of , considering both the risks and opportunities. 1.    Interest Rate Hikes One of the biggest concerns for investors in multifamily properties is the potential for interest rate hikes. When interest rates rise, it can make it more expensive for investors to borrow money to finance their properties. This can lead to a decrease in demand for multifamily properties and a corresponding decrease in property values. However, it’s important to note that the Federal Reserve has indicated that any interest rate hikes will be gradual and tied to the strength of the economy. Additionally, interest rates are still at historically low levels, which can provide investors with opportunities to secure financing at relatively affordable rates. Investors should be cautious but not overly concerned about potential interest rate hikes in 2023. 2.       Bank Failures Another potential risk to the multifamily property market is the possibility of bank failures. If banks fail, it could lead to a decrease in lending, which could make it more difficult for investors to secure financing. This, in turn, could lead to a decrease in demand for multifamily properties and a corresponding decrease in property values. However, it’s important to note that the banking industry is heavily regulated, and many banks have taken steps to improve their financial stability since the last economic downturn. Additionally, the federal government has measures in place to help stabilize the banking industry in the event of a crisis. While investors should be aware of the potential risk of bank failures, it’s unlikely to have a significant impact on the multifamily property market in 2023.      3.     Returns Being Less Than What Have Been Another concern for investors in multifamily properties is the potential for lower returns. With property values and rental rates already high, it can be difficult for investors to find good deals that provide high returns. Additionally, increasing operating expenses, such as property taxes, insurance, and maintenance costs, can further reduce returns. Trends in Multifamily Properties One of the most significant trends in multifamily properties is the shift in demand. The COVID-19 pandemic has forced people to re-evaluate their living arrangements, with many opting for larger apartments or houses to accommodate their work and living needs. The rise of remote work has also contributed to the demand for larger living spaces, as people seek more room for home offices and other work-related amenities. Another trend in multifamily properties is the growing preference for sustainable living. Tenants are becoming increasingly environmentally conscious and are looking for properties that have energy-efficient appliances, green spaces, and other eco-friendly features. As a result, investors who incorporate green initiatives into their properties can benefit from increased tenant retention and higher rental rates. Challenges in Multifamily Properties Despite the positive outlook for multifamily properties, there are also challenges that investors should be aware of. One of the biggest challenges is the rising costs of construction materials and labor, which can drive up the cost of new developments and renovations. Investors may need to adjust their budgets or explore alternative building materials to stay competitive in the market. Another challenge is the increasing competition among investors. As more investors enter the market, the supply of available properties may become more limited, driving up prices and making it harder to find attractive investment opportunities. To stay ahead of the competition, investors must be vigilant in their research and evaluate multifamily properties.  Opportunities in Multifamily Properties Despite the challenges, there are also opportunities in multifamily properties. One opportunity is the growing demand for affordable housing. With rising housing costs and stagnant wages, many people are struggling to find affordable housing options. Investors who prioritize affordable housing can tap into a growing market and help address a critical social issue. Another opportunity is the increasing popularity of urban living. Young professionals and empty nesters are drawn to the convenience and amenities of city living, driving demand for multifamily properties in urban areas. Investors who can acquire or develop properties in desirable urban locations can benefit from higher rental rates and strong tenant demand. To be successful in multifamily property investing in 2023, investors must develop a solid investment strategy that aligns with their goals and objectives. One strategy is to focus on properties that offer sustainable features and amenities, such as energy-efficient appliances, green spaces, and access to public transportation. These features can help attract environmentally conscious tenants and increase the overall value of the property. Another strategy is to focus on affordable housing options, which can help address a critical social issue while also providing a stable source of income. Investors who can acquire or develop properties in desirable urban locations can benefit from higher rental rates and strong tenant demand.   Related: 2022 U-Haul Report Reveals Texas and Florida as Great Multifamily Investing Opportunities Investment Strategies for Multifamily Properties To achieve success in multifamily property investing in 2023, investors need to establish a robust investment strategy that is in line with their desired outcomes and objectives. A viable approach is to concentrate on properties that provide sustainable amenities and features, such as access to public transportation, green spaces, and energy-efficient appliances. These features can help attract environmentally conscious tenants and increase the overall value of the property. A different approach is to concentrate on making housing more affordable, which not only tackles a crucial societal problem but also creates a reliable stream of revenue. Investors who can acquire or develop affordable housing properties can benefit from government subsidies … Read more

Maximizing ROI in Real Estate: A Guide for Investors

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When you purchase a property as an investment, one of the most important metrics is the Return on Investment (ROI). The ROI tells you how much profit you’re making on a property. What is ROI? Return on investment is the money that is made through real estate investments. It is a measure of how much money has been earned compared to the amount of money invested. If a property earns more than its cost, you have an investment that provides a positive return. Conversely, if it costs more to own than what you earn, you have negative returns or losses. Factors that can affect ROI in real estate include property condition, location, market conditions, financing options, and property management. Therefore, real estate investors should consider all these factors when evaluating potential investments and aim to maximize ROI through careful research, strategic buying, and long-term holding. How to Calculate ROI in Real Estate? Return on Investment (ROI) is a measure of the profitability of an investment. For example, in real estate, the ROI is often used to calculate the profitability of property investment. To calculate the ROI on a real estate investment, you need to determine the property’s net operating income (NOI) and the total investment costs. Net Operating Income (NOI): NOI is the property’s income from rent and other sources minus operating expenses such as property taxes, insurance, and property management fees. NOI = Gross Income – Operating Expenses Total Investment Costs: Total investment costs include the purchase price of the property, closing costs, repairs and renovations, and any other costs associated with the acquisition of the property. Return on Investment (ROI): Once you have determined the NOI and total investment costs, you can calculate the ROI using the following formula: ROI = (NOI / Total Investment Costs) x 100 For example, if a property has an NOI of $50,000 and total investment costs of $250,000, the ROI would be 20% (50,000 / 250,000 x 100). Related: Cap Rates vs. IRR in Commercial Real Estate Investments How to Find Your Return on Investment (ROI) Finding your return on investment (ROI) in real estate can be more complex than other investments. However, here are the steps you can take to calculate your ROI on a real estate investment: Determine the property’s net operating income (NOI): NOI is the property’s income from rent and other sources minus operating expenses such as property taxes, insurance, and property management fees. To determine the NOI, you’ll need to know the property’s gross income, which includes all rent and other income, and its operating expenses, which include property taxes, insurance, and property management fees. Calculate the total investment costs: Total investment costs include the purchase price of the property, closing costs, repairs and renovations, and any other costs associated with the acquisition of the property. Make sure to include all costs, including financing costs, such as interest and closing costs. Calculate the ROI: Once you have determined the NOI and total investment costs, you can calculate the ROI using the following formula: ROI = (NOI / Total Investment Costs) x 100 Take into account the holding period: ROI is a metric used for short-term investments; for long-term investments, the internal rate of return (IRR) is a more appropriate metric. IRR accounts for the time value of money and cash flow over the holding period. Analyze the cash flow: Cash flow is the money left after paying all the property expenses. A positive cash flow means that the property generates more income than expenses, while a negative cash flow means that the property generates less income than expenses. Consider the appreciation potential of the property: Appreciation is the increase in the value of a property over time. Appreciation can be caused by factors such as improvements to the property, changes in the local real estate market, and inflation. Consult with a professional: It’s important to consult with a real estate attorney or accountant to ensure that you know all the legal and tax implications of investing in a property. They can also help you to calculate the ROI, IRR, and other relevant metrics for your specific investment. Various Methods for Calculating ROI in Real Estate There are different ways to calculate ROI in real estates, such as the Capitalization Rate (Cap Rate), Cash on Cash Return, Internal Rate of Return (IRR), Gross Rent Multiplier (GRM), Price-to-Rent Ratio, and Appreciation. Each method provides a different perspective on the performance of the investment and can be used depending on the type of investment and the investment goals. Capitalization Rate (Cap Rate): This is calculated by dividing the net operating income (NOI) by the property’s purchase price or current market value. A higher cap rate indicates a higher return on investment. Cash on Cash Return: This is calculated by dividing the annual cash flow generated by the property by the amount of cash invested. This metric is useful for evaluating the performance of rental properties. Internal Rate of Return (IRR): This is a more complex metric that considers the cash flow, the time value of money, and the investment’s holding period. IRR is often used to evaluate the profitability of multiple-year investments. Gross Rent Multiplier (GRM): This is calculated by dividing the property’s purchase price or current market value by the gross annual rental income. A lower GRM indicates a higher return on investment. Price-to-Rent Ratio: This compares the purchase price of a property to the annual rental income it would generate. A lower ratio indicates a better return on investment. Appreciation: This is the increase in the value of a property over time. It can be calculated by comparing the purchase price to the current market value or future expected value. Final Thought The ROI in real estate varies widely depending on the market and the property, but you can find a general benchmark by looking at investment property averages across the nation. By doing research in your area, you can determine if the numbers make sense for … Read more

2022 U-Haul Report Reveals Texas and Florida as Great Multifamily Investing Opportunities

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U-Haul ® is the largest rental truck company in the United States. The U-Haul Migration Trend Report: 2022 Edition is based on data collected by U-Haul International’s nearly 450 franchise dealerships and reflects more than 94 million moves handled by U-Haul during the past year. This Is Great News!  Key Findings From the Report Include: Texas was the No. 1 destination for one-way truck rentals from another state in 2022 — followed closely by Florida, California, and New York. Texas took top honors for moving into the state with Louisiana (No. 2), Indiana (No. 3), and Oklahoma (No. 4). Florida was also a popular destination for incoming one-way truck renters from other states, including Georgia (No. 5), South Carolina (No. 6), North Carolina (No. 7), and Alabama (No. 8). The U-Haul report shows that Texas and Florida have been consistently popular destinations for one-way moves due in part to their strong economies and growing populations. Other states that have significantly increased one-way truck rentals include Arizona, North Carolina, and Tennessee. Related: Austin Housing Market Predictions 2022-23 The report also noted that many of the states that have experienced the most growth in one-way truck rentals are located in the South and Southwest regions of the United States. This suggests that many Americans are moving to these areas in search of better job opportunities, lower costs of living and more desirable climates. The Top 8 Growth States For 2022 Are: Texas – 1,065,055 trucks Michigan – 918,188 trucks Georgia – 875,717 trucks Florida – 796,324 trucks California – 749,942 trucks New Jersey – 672,619 trucks North Carolina – 651,843 trucks Illinois – 536,043 trucks Bottom Line Overall, the U-Haul report provides valuable insights into the current state of migration in the United States. For example, it shows that Texas and Florida remain popular destinations for one-way moves, while several other states in the South and Southwest are also experiencing significant growth in this area. Higher populations and in-demand markets helps position more apartment demand and solid multifamily occupancy rates. Join Us For A Daily 60-second Coffee Break Series For Passive Investing In Commercial Real Estate With James Kandasamy, The Best-selling Real Estate Author And Mentor.