Month: March 2023

How To Use Gross Rent Multiplier In Real Estate Investing?

What is GRM? A common metric in multi-family investing is Gross Rent Multiplier (GRM), which measures the price being paid for the rent the asset produces. The lower the GRM, the more favorable. This signifies that the buyer is paying a relatively lower price for the rental income produced. A simple example: if a buyer […]


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3 Red Flags with Potential Property Managers

You may have heard, but in case you haven’t, when it comes to your real estate investment portfolio, your property manager is the most integral part of your team. Why is this? Your PM directly manages your or your team’s real estate assets. They work directly with the residents of your property, have a real-time […]


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4 Reasons Stocks Are No Longer My Primary Investment Strategy

Like many, my foray into investing began in college after a gaining an appreciation for the stock market. I was attracted to the idea of discovering new companies, investing my cash into their stocks and being able to see my funds in a stock portfolio dashboard. I loved watching those numbers climb. I felt myself […]


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Solve for X – An Investor’s Relentless Pursuit of Problem-Solving

On this investment journey, we encounter many obstacles, ranging from speed bumps to mountains. To overcome takes knowledge and experience, a good network and most importantly, a persistent approach to problem-solving. In the multifamily investment business active investors must wear many hats: The list goes on. Any firm that actively syndicates great multifamily investments needs […]


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Operational Value Add In Multifamily Investing

One of the most attractive aspects of the multifamily asset class is the ability to grow the value of the property by improving net operating income, which is the result of improved performance. Physical Value-Add The value-add strategy grows the value of the property by making improvements that does any combination of increasing income and […]


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Managing Loss-To-Lease In A Value-Add Multifamily Investment

Loss-to-Lease Loss-to-lease is an economic vacancy line item that describes how much the operator is losing by charging rents below the market rates. Especially in fast-growing markets where rents continue to rise, each property will have loss to lease at some point. As the buyer, loss-to-lease could be evidence that there are further opportunities to […]


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How Working Professionals Can Track Their Passive Income

If the goal of freedom through passive investing is to generate enough passive income to meet or replace your earned income, then it makes perfect sense to track the progress. After all, what is not measured is not managed. Without doing so, how will you ever know how you are tracking towards your passive investor […]


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What is Loss-to-Lease in Multi-Family Investing?

There are endless terms in real estate investing with which to familiarize yourself. To help, I have created a resources page just for terms. Many items can threaten the income potential of your property. There is physical vacancy, bad-debt, concessions and more. Let’s discuss Loss-to-lease. Loss-to-Lease: A concept describing when current rates are lower than […]


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The Attractiveness of Class C Multifamily Properties

In the multifamily investing world, there are various classes of assets that are subjectively categorized based on the following characteristics: age, condition, demographic, etc. We wrote a blog post explaining each of the asset classes. Check it out here. One of the most attractive multifamily classes is Class C assets. These are characterized as older, […]


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Two Types of Problems for The Middle Class

As the American middle class, we most likely can look around our lives and we see that we have been adorned with immense blessings. A house, two nice cars, healthy, literate children…we are insanely wealthy when we compare our lives to those in most other countries. Yet, we know that we have our own sets […]


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An Explanation of Risk Aversion and Investing

Those who do not invest outside of traditional asset classes such as stocks and 401k plans may consider non traditional assets risky. Further, they may assume those who invest in real estate, businesses or other forms of private equity extremely risky people. However, this mistaken assumption about these types of investments and investors is not […]


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Why Most Working Professionals Do Not Want To Flip Homes

When we are just getting started into the world of real estate investing, we run across volumes of strategies and can easily be overwhelmed with our options. Without a mentor or coach, we will very likely spend time considering a strategy that is incompatible with our investment needs and goals. Most times it seems, working […]


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Applying Buffett’s Margin of Safety to Passive Investing in Multifamily Assets

“Price is what you pay. Vale is what you get.” – Warren Buffett We all recognize Warren Buffett, the Oracle of Omaha, as one of the wisest investors to walk the planet. His track record is impeccable and his habit of discipline in uncertain is unmatched. His statements and investment advice become famous and nearly […]


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2 Options for Achieving Targeted Rents on New Acquisitions

One key fundamental of multi-family syndications is rent growth. The appeal to investors of a new acquisition is the potential to ultimately grow rental income and, subsequently, net operating income and value. Ideally, this rental growth happens as soon as possible so that the operators are in the best position to sell sooner. However, there […]


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What is Break-Even Occupancy Ratio and How it is Used?

In order to mitigate risk, one must first identify it. When it comes to apartment investing, a great risk to potential gross income (PGI) is vacancy. If vacancy is too high, it threatens cash flow and the ability to pay debt service. Astute investors identify up front what is the maximum vacancy (minimum occupancy) that […]


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What is the Equity Multiplier in Real Estate Investing?

What is the Equity Multiplier? As passive investors, it pays to have a complete understanding of the menu of metrics provided to you by deal sponsors for multi-family assets. One of those metrics is the equity multiplier. This simply measures the percentage of the assets value that is equity. Calculation The equity multiplier is calculated […]


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