Yes they fluctuate with the market, but they also fluctuate with the credit of the tenant.

how do you cope with the dollar fluctuations.

Yes, the market is hot now so caution is warranted, an yes there are and will be short term market fluctuations, which is why you need to find a great deal below market to insulate you to some degree from these fluctuations.You asked are you missing something?

It's worth taking a look at if you are looking for a solid market that didn't fluctuate as much as other markets during the crash.  

It is this discount to retail that not only gives you the extra exit strategies, but also insulates you to a large degree from short term market fluctuations.

Generally speaking, 1-4 unit buildings will be valued based more so on comps than on the "income cap" approach.Having said that, a true 7.7% cap rate -- assuming that's based on conservative underwriting -- sounds reasonable if you're talking about one of the better areas in Essex County.Another thing to keep in mind is that even within an area, cap rates will fluctuate.

Also bear in mind the minimum must be kept at all times so if you have a fluctuating balance sheet you will at times not have the proper net worth, probably due to spikes in liability or conversion of loan assets to real property assets.The financial statement needs to be prepared by a professional so chat with them about where you are and if it might be a good idea to hold a certain balance in a interest bearing account to maintain the minimal amount standard.  

Prices fluctuate depending on the neighborhood the house or apartment is situated at.

We are a seasonal business with lots of fluctuation.

This fluctuation has run its course and left a more reliable market in Southern Arizona.