What is a good deal? Where do you start?

acquiring deals analyzing a deal buying land market research Dec 01, 2021

How can tell if a real estate opportunity will make a good or bad investment? What is in the market right now and are you doing better than that?  What does the cashflow look like? How important is cap rate? This can be a tough subject to navigate, especially when some deals don't pencil out the best but offer enough tax savings to make it tempting...

Today we want to talk about something that's a little bit subjective, I think because you always hear people, especially online in forums talking about, "I've got this good deal, or I've got this bad deal."

So the question is,

What's a good build-to-rent deal?

What is a good multifamily deal? I think we can answer that in two ways.

We want to kind of hit it around for a minute here to see what everybody thinks.

A good deal is often "What is in the market right now? And are you doing better than that?" That's a good deal.

But also a good deal can be highly individualized. So right now, letter of the law: What's a good deal? What do you think?

Chase Leavitt: I just heard that this was the topic, right? And so I wrote down a couple of things. I'm just gonna throw them out there. We don't have to go into them, but this is what came to my brain.

  • Tax Shelter/Tax Savings

  • Cash Flow

  • No Brain Damage

  • No Headache

  • Cap Rate

  • Equity Play

  • Location

Sherida Zenger: I think it just it all depends on what is important to you. Some people are worried about a cap rate, some people are worried about cash flow.

I'm working with a client right now that says I want to close by the end of the year, because he's able to do a cost segregation study, so he needs it for his taxes for this year. So everyone has different reasons what are driving them to invest and at different times of the year. So what makes it a good deal for them.

Chase Leavitt: That's why throughout the tax savings/tax shelter right now at the end of the year. We have a couple of investors that need to buy properties. They might not pencil the best, but we're buying a couple of properties that don't cash flow may be as much as they're used to. But if they're gonna save 100-200k, maybe more in tax savings, because they're purchasing X amount of units, it might be a good deal for them.

Watch the rest of the episode here: 

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