Results for ‘Debt’ category

What’s the best way to buy with a small downpayment?

Today’s NY Times has an interesting comparison of 5% down FHA and conventional loans. (For more about the basics of FHA loans, read this.) It turns out that the increased mortgage insurance premiums currently demanded by FHA make FHA loans a worse deal than 5% down conventional. If you’re considering buying with little money down

Debt yield explained

Was at a conference on syndication yesterday and came across an interesting idea: debt yield. Debt yield is yet another test lenders use to determine whether or not they should make a loan on a 5+ unit deal. The math looks like this: Divide the building’s NOI by the proposed loan amount. The resulting quotient

Why more sellers should be carrying back

One of the things that bothers me about today’s real estate market is the relative scarcity of sellers willing to carry back mortgages. To understand why I think it’s weird, we first need to understand what seller carry back financing is. Simply put, seller carry back financing is when the seller of a property provides

Is it too late to buy?

A lot of people are wondering whether it’s already too late in the cycle to buy. After all, prices have bounced back up off the floor of 2009-10. For context: I sold a bunch of totally renovated buildings in 2011-12 for 10-10.5x the rents. I would get 11x all day right now, and possibly more.

Are you an investor or a speculator?

Market prices are up across the entire city. Where you could once buy stuff for 10x GRM, almost everything is now 12x+. If you’re looking at deals now, it’s important not to get caught up in thinking about buildings relative to each other. At any time, I can tell you what the best thing to

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