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 […]
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 […]
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 […]
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, […]
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 […]
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 […]
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 […]
“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 […]
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 […]
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 […]
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 […]
One of the biggest fears for people getting started as rental property investors is whether the tenant will pay rent on time or sit in the house as long as they can until they are legally forced to move. Maybe you know someone with this horror story. Sure it happens, especially in COVID times, and […]
We wrote about it in The Greater Responsibility of Multifamily Investing because we see this topic hardly discussed: the importance of our residents who live in our apartment communities. Yes, we invest in multifamily for wealth creation, but we love the communities in which we invest and our other reward is knowing that we are […]
When it comes to wealth building, different people have different ideas. Some people want to save as much cash as possible and obsess at the dollars in their savings accounts as a metric of safety, Understandable, sensible and somewhat useful, beyond having what is necessary for emergencies and even extra margin, savings in cash is […]
Multi-family investments can be very rewarding. You have the benefits of scale – both in terms of cash flow, value and economies and efficiencies – and impact larger numbers of people with the improvements you make to your properties and its operations. After going through the hard work to learn about multi-family investing, there is […]
Most working professionals rely on one type of income, and that is from their w-2 job, which we refer to as earned income. There is nothing wrong with this and earned income can pay very well for working professionals. However, true, lasting legacy wealth will not be built on earned income and a 401k alone. […]
Back when I was a leasing agent in college, we would go around once a quarter tour properties in the highly competitive student housing market to better understand the competitive situation. Our apartment complex at the time was the top choice for off campus housing, however, due to the demand for student housing, our limited […]
Passive vs. Earned Income Passive Income is more scalable than earned income. Why is that? Because earned income requires your work, presence, effort, attentiveness. Usually, working professionals have one, a maximum of two, earned income streams. Passive income streams, on the other hand, can infinitely scale to ridiculous amounts with some focus and good decision […]
One of the key metrics of investment returns is the internal rate of return, or IRR. This concept goes beyond the annual rate of return which simply measures the overall return through cash flow and the sale of the asset and divides it by the number of years. Average Annual Return (AAR) For example, consider […]
Happy New Year ‼️🎈🎆 Warren Buffet famously said to be fearful when others are greedy and greedy when they are fearful. The last few years of expansion have been filled with greed as large bubbles were formed in all asset classes from stocks, real estate and cryptocurrencies. During this time, anyone could have made good […]
Yesterday I made a shocking discovery….the stock that I am long and optimistic for the long term, Rivian Automotive, is very highly correlated with a problematic and more well-known rival, Tesla. Being in the same industry and EV space, I knew that to some degree, they would trade similarly, increasing and decreasing loosely together, but […]
As passive investors, it pays to know what to expect from a high performing private equity firm. When placing your hard-earned capital into an investment opportunity, you are essentially trusting that the firm will manage the money and the asset well in order to achieve the desired results. Not all investments or money managers are […]
The subject of resident safety and welfare is not often discussed in the apartment investing community. Here at Robinson Capital, improving communities in which we invest is a core piece of our mission, so we ensure to discuss our strategies for communities to win alongside us. A big piece of safety and tenant quality is […]
This has been a crazy few months! As you may know, I sold one of my rentals a few months back in February 2022. At the time of listing the house, we had multiple competitive offers within days and about 15 to choose from by the end of the week. We were under contract by […]
During this bearish earnings season I took the opportunity to buy some long term positions in both Amazon and Rivian, two very different companies that appeal to me in different ways. 1️⃣ Amazon Amazon is a global winner that dominates in every segment it enters. It’s Q3 earnings , while better than Q1’s loss, were […]