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Re-examine Cap rates on investment property

By
Real Estate Agent with Keller Williams Realty

Re-examine Cap rates on investment properties. The rules may not have change however they have become tighter. In today's environment more of a down payment is often ask. This will effect the cap rate as there is less leverage. Appreciation should only be used as "gravy" and not a given. The clean and paint philosophy can still work with the right property. Deferred maintenance should not be deferred.

With return on investment in Treasury'sand CD being very low, there would seem to add to the attractiveness of Real Estate as a safe haven. The uncertainty is hurting consumer confidence. There seems to be a infinity of crystal balls of where the Market (economy) will be and side liners waiting to get in. I do beleive that there is a more realistic approach to what a true cap rate is for Real Estate. My point  being that a few years ago 6 percent return on investment seemed dismal. How does it sound to you now.

Would like to hear your thought.

WWW.RealEstateWorkHorse.com

Posted by

Bonner Thomason

Jim Fischetti
The Fischetti Group/Keller Williams - Wake Forest, NC

Very good post.

 

Insightful, thanks for sharing.

 

Jim Fischetti

Mar 23, 2009 08:36 AM