The Buyer's Magic Number Reaching into my magic hat... Presto... we've got the buyer's magic number. No sleight of hand tricks here. The buyer must buy the property for no more than $2,125,000. This is the amount that pays off the seller’s mortgage or assumes it, gives him/her $625,000 in equity at closing and yields 8.
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Solving the “What’s the Cap Rate” Dilemma – Part 1 of 3
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Posted by John Simpson
Many deals for marina acquisition just don't happen. I'm not just referring to deals in the current recession... I'm addressing all market cycles. "Meetings of the mind" don't happen as much with marinas as they do with other common property types because there are greater perceptions of value differences between sellers and buyers. ![]()
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Read moreProving Band of Investment & Mortgage Equity Cap Rates are Obsolete – Part 1 of 2
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Posted by John Simpson
In prior posts, I've outlined many of the weaknesses of each of these techniques. What I find interesting is that the Band of Investment and Mortgage Equity techniques are still being used rampantly in the appraisal industry today. This recession should have been a wake-up call that market derived cap rates are the way to.
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