Building Futures
Part 2 – New Construction Equity Bump vs Cap Rate

Part 2 – New Construction Equity Bump vs Cap Rate

Roger explains an example of how Cap Rates affect the New Construction Equity Bump and IRR.

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New Construction Multi-Family “Equity Bump” Builds Wealth Fast!

New Construction Multi-Family “Equity Bump” Builds Wealth Fast!

The “equity bump” you get when you build new construction multi-family helps you build equity (and wealth) very quickly in the first couple years of ownership.

There are a lot of reasons why building new construction multi-family properties is much more attractive than buying older properties and my new Book:

Don’t Buy Multi-Family! BUILD IT

goes into all of that, but I think a lot of multi family investors are very focused on cash flow numbers and might not understand how important it is to also look at the equity side of the equation.

So let’s look at a quick example from the book: Here we’ll look at the numbers for a new 4 story building with 3 ~ 1700sf 3 bedroom apartments over a smaller commercial storefront unit.

First we’ll look at the cash flow numbers for the finished project and then we’ll look at the equity position and projected sales returns.

This is where we examine the new construction equity bump that in this example helps us increase our equity by 70% after just the first year of operation! 

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Don’t Buy “Value Add” Deals. Build New Instead!

Don’t Buy “Value Add” Deals. Build New Instead!

With higher inflation numbers, investing in multi-family income properties makes more sense than ever. The problem is that finding a property with good returns is like finding a unicorn.

There is a lot of competition for quality properties and prices are very high, which of course means that returns are very low (in other words, low cap rates).

Properties that are cheaper to buy normally need quite a bit of construction work to re-position them in the market for higher rents.

Most of the big syndicators are buying properties like these, ‘value add” deals that have room for them and their investors to make money.

But if you look around in Chicago and other growing markets, big developers are putting up offices, apartments and condos as fast as they can right now.

Why? Rates are low, rents are at all time highs and demand for new construction units is very high. Now is the time to build new construction!

Why would you want to compete to over pay for an older building and then do a bunch of construction work rehabbing it, only to achieve rents much lower than new construction.

My new book: Don’t Buy Multi Family! BUILD IT will show you how the numbers work and how you can find opportunities to get started building new construction multi-family yourself.

Grab a copy on Amazon and learn how it’s done. https://www.amazon.com/gp/product/B09PSFMC6Z/ 

2 New Books!?

2 New Books!?

Probably releasing 2 new books in the same month is not the best strategy, but hey, what can I say!

The books are really written for 2 different audiences.

Don’t Buy a New House! BUILD IT

Is written for people who are interested in buying a new house, but are having trouble finding what they want. I wanted to show them that right now is actually a great opportunity for them to take advantage of the best market I’ve ever seen to build their own custom house and how they’ll be creating wealth in the process.

My other book:

Don’t Buy Multi-Family! BUILD IT

Was just released. Is written for investors interested in multi-family income properties who are finding that none of the properties that are on the market now make sense. There is more and more competition to buy properties that are really marginal investments at best.

Meanwhile, developers are putting up new apartment towers, offices and condos as fast as they can build them.

I’ve been in real estate and development for 35 years now and I’ve never seen a better time for investors to build new construction investment properties.

This book will show you can take advantage of it. Here’s a link to get the book on Amazon:

https://www.amazon.com/gp/product/B09PSFMC6Z/

If you subscribe to follow this channel, in the coming days and weeks, I’ll be posting videos with more detailed information and examples from the books.

If you have more specific questions, you can reply here, or refer to our web site http://ld2development.com

 

New Book – Don t Buy Multi Family! BUILD IT

New Book – Don t Buy Multi Family! BUILD IT

Here in Chicago, we see big developers putting up new high rise apartments towers, condos and office buildings like crazy right now.

There’s incredible pent up demand for new construction and when you combine that with historically low interest rates, you have a perfect climate to build new projects.

My new book Don’t Buy Multi-Family! BUILD IT tells investors how they can join the party and why now is the best time ever to do it!

I see so many people trying to invest in multi family income property right now, only to find that they are just not interested in any of the properties that are on the market. There is more and more competition to buy properties that are really marginal investments at best.

I’ve been in real estate and development for 35 years now and I’ve never seen a better time for investors to build new construction investment properties.

This book will show you how to do it. There’s a link below to get the book on Amazon.

https://www.amazon.com/gp/product/B09PSFMC6Z/

And If you’re an ebook reader, there’s even a special $1.99 intro price on the ebook right now!

If you subscribe to follow this channel, In the coming days and weeks, I’ll be posting videos with more detailed information and examples from the book to show you how to find and recognize a great investment deal when you see one!

If you have more specific questions, you can reply here, or refer to our web site http://ld2development.com

 

Hybrid Work Brings New Office Paradigm

Hybrid Work Brings New Office Paradigm

Hybrid work is the buzz phrase right now in HR and recruiting. And of course, a lot of us are spending time working from home now but to employees, hybrid means they want flexibility in their schedule. Rather than a fixed schedule where it’s like, okay on these days you come into the office and these days you work from home, they want to be able to come and go when they want. Hiring talented people is very challenging right now in almost every industry. Much like in real estate, we have a sellers market for job seekers and employers are finding that they need to step up their game in order to attract top talent and that means to provide the right work environment. People in the workforce now are expecting to be treated like adults who are capable of making good decisions about when they need to be in the office and when they can get more done at home or from another remote location. Top companies, those are the ones that win awards for best places to work and things like that, they realize that a good hire is going to thrive with this flexibility and that that’s the person that they want to hire for the growth of their company. If you’re interested in investing or building, developing for yourself, even if it’s in a small way, it’s really important to understand the deeper trends that are driving the market. And just like in trading stocks or anything else, profits are made by riding that wave of the trend and that’s the way you do it.