True or False: Private Funding as a model only works with BRRR?

[Rabih El-Khoury]

Unlike a bank, a private investor (not a hard money lender) is looking to get their principle+interest within a very short period of time, 1-5 years. Whether they're getting interest only at first or a one-shot balloon payment at the end of the deal term, it doesn't matter: what matters here is that it is a short period of time.

With private investors looking at anywhere between 7%-12% ROI, there is no way a property investment can afford that kind of investor return unless it (1) a BRRR play or (2) a flip. In other words, you're typical buy and hold won't accumulate enough cash flow.

True or False?

[Brad Smith]

We have rates starting at 4.99% Stated Income if credit score and DSCR are high enough and LTV is low enough. The rapidly expanding Private Equity market is ever driving prices, through competition, downward in the direction of bank pricing.