Apr 26, 2022
I feel super fortunate to have been able to meet and become friends with some really big-time real estate investors. A friend of mine owns and manages roughly $400 million between himself and his investors’ portfolio so when he starts changing the way he does something my ears perk up. I’ll get to what he says shortly into this week’s episode but for now, I’d like to ask you if you can think of anywhere where a property costs less five years ago than it does today? I didn’t think so.
Prices have skyrocketed in most
real estate markets. I know that is not news to most of you but
what exactly is it that makes you think these properties are
expensive? Yes, the price is certainly higher but are they actually
more expensive? For me, a property is expensive when it no longer
makes money. When it can’t cash flow. When the rents and income no
longer exceed the expenses it takes to own the property. That is
the point when a property (for me) does not become a sound
investment option. And so if we look at it that way then a
property’s sales price actually has much less to do with the whole
equation.
If
you’re looking for one more nudge to help you pull the trigger,
I’ve got another metric for you: price per square foot (psf). It
allows you to compare between properties and provide a whole bunch
of insight to help you make a better-informed decision. So this
week we’ll talk all about that and:
Check here for stats. And new home source ▪
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