All Forum Posts by: Jason DiDonato

I agree!  Thanks, I appreciate the information!

The numbers when I do that are significantly skewed because the rents were so low. Purchase price was $600K. Rental income was $3,505 ($42,060 annual). Expenses when purchased $16,518 ($6,360 annual 10% capx), NOI of $25,542. Cap Rate was 4.3%.

Current rents are now $80,400, Expenses are $21,540 (10% capx included), NOI of $58,860. If I did the same 4.3% cap rate the value would be $1.3 mill which is not an accurate value for the property, unless I'm missing something!

Looking to understand value as we will need to potentially refinance in 1-2 years because its seller financed and has a larger rate increase and ballon clause in the near future.
  

I was looking more towards the market cap rate.  Trying to get a better understanding of what the true value of the property may be.  We have a change in the interest rate for year 4 and 5 before final balloon payment is due and I was just looking to see what value might be based on what we have and will be getting the rents up too.  Appreciate everyone's help!

I bought a building on seller financing last year due to the low rents that the units were paying and received a fair purchase price for the property. I'm wondering how to estimate the value of the building-based NOI/Capitalization rate. NOI is $50,220 but I can't seem to figure out the Cap rate on a 6 unit building. It's a mix of 2 residentials and 4 commercial rents. Any help would be greatly appreciated!