All Forum Posts by: Hollis Vossekuil

Thank you guys so much for the advice. The 1031 and value add investor side make a lot of sense as to how these are selling as 5 caps. Sounds like I need to be planning for something outside of the Bay. Thank you all again!

Hi Russell,

So essentially if I'm investing in something like that I am solely banking on continued appreciation and that demand will rise higher correct? If I am looking for something that will cash flow I should not be considering these assets and instead look for higher cap rates in emerging markets?

Thanks for your input.

Question is pretty straightforward, I live in the Bay Area and see numerous MultiFamily properties advertised for 5% Cap Rates and below. My question is how this is profitable for investors? If I'm most likely borrowing money at 5%, (NOI - Debt Service) would then equal 0 cash flow.

Is the strategy on this property to hold for appreciation only and forego the cash flow in the meantime? Is there some part of this calculation I am missing? Thanks guys.