Over the past few days, I have been in San Francisco, and have had the privilege of meeting with four real estate executives whom I am trying to interest in participating with the Lusk Center in one way or another. They are all doing remarkably well, all things considered, and some of the things they said to me explain why. Two things stand out:
(1) When investing in real estate, underwrite the real estate without consideration for financing. Unless the deal earns an acceptable unlevered internal rate of return, don't do the deal.
(2) If a deal depends on a going-out (i.e. exit) cap rate that is lower than the going-in (i.e., purchase) cap rate, don't do the deal.
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It also helps to be able to do your own Argus runs.
I agree with the comments you received from the execs. Buy for cash flow today, not capital appreciation tomorrow. You can't count on the market to continually go up - as everyone has to keep relearning every time we have a major downturn like the one we're in now. As long as the tenant is credit worthy and has staying power, and the investment provides cash flow from day one, you'll be better off in the long run.
Thanks for sharing information. Your information will be useful to people who like to do real estate investments. Some of the realtors asking low commission to buy and sell real estates. Realtors help investors and consumers get great deals on Real Estate.Realtors help to save you considerable time and money while purchasing real estate.
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Nice Post. Your information will be useful to people who like to know about real estate market investing. The new comers of real estate market can learn secrets and tricks from experts. Books, CDROM course and training course in online are available to get valuable information about real estate market. To escape from recession, real estate marketers have to know about secrets of investing in real estate market.
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Hi,
It is an interesting post.
One important tip for real estate investing for beginners is that they should know the whereabouts of real estate investments. It's hard to get involve on something that you don't even have any clue on what is really going on. Training is one of the best tools to gain knowledge about this business, aside from researching and reading. For beginners, training will help you understand more about this kind of investment.
Thanks for sharing information. Your information will be useful to people who like to do real estate investments.
Thanks for sharing information. Your information will be useful to people who like to do real estate investments.
Good day !.
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It is a very interesting article. Realtors play an important role in real estate and investment!
Real Estate Advice
Interesting, would not have thought about it that way myself.
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Good to know that this topic is being covered also in this web site.
Keep up with the good work.
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