For me, this spreadsheet would change on a client to client basis, depending on loan terms issued from the bank. Unfortunately, foreigners typically won't get this deal over in the US. You can, but it would take a lot of bending over backwards.
I can customize any financial analysis for anyone. This is just an example of how I do things on the commercial end of things. For a single family home, this is too complex.
CheevesFinancial | Cushman & Wakefield - Commercial Property SW FL
http://www.CommercialRealEstateVoice.com
Email Me | Phone MeAs far as SS's go they tell you what you want to hear in the main. Fin models are only as good as the inputs. SS designers tend to reflect what the writer wants to know relevant to their particular style or strategies in investing so make sure you understand what the SS is telling you.
In this case the figures are static projections based on time of purchase. The SS doesn't have the capability to model dynamic trends or events. It doesn't look at market or book value on a YoY basis. Cap rates are based around purchase price.
All this is OK as long as you understand the limitations. Inflation and CG inputs can be very subjective and subject to a lot of market noise. What is real inflation? How do you reflect CG realistically over the life of an investment. What if rental rates stay static or climb faster/slower than the inflation rate?
This SS can't give you a 'what-if' look into the future. For someone who can write SS's adding this feature might prove useful. The problem today is that markets are very volatile compared to the past. Trying to get a handle on best case worst case scenarios (especially worse case) is a must.
Anyway this SS is useful because it gives an inside-out look at analysis (local) rather than an outside-in look (foreigner).
Freckle – Of course the numbers are based on projections. If there was more of a guarantee then projections in real estate, everyone would be a bazillionaire. There is calculated risk in investing. I'm basing my inflation numbers off of a bell curve analysis of what has happened over 100 years and factoring that into trends I've seen over the last 10 years..also fed rate guessing, inflation, etc…. It's not easy coming up with 3% inflation and feeling comfortable using that number. It's not arbitrary, it's assessed. You may use a different number. The purpose of this spreadsheet was to give insight as to how I evaluate properties, which could be different from you.
Trust me.. This spreadsheet is very very similar as to what the big players use here. Losing is an alternative to winning and being good at what you do combined with guesstimating figures based on knowledge can alleviate the risk. Nothing more. Like I said previously, I've made business decisions and lost a bundle….but I was ok with that going in because I was able to quantify average risk. I made what I thought was an educated decision and lost. Big deal. This is my life, and I'm sharing how I go about it for me and what my clients expect of me. It's simple. No need to complicate it more then this. If you can't make an educated decision after using this spreadsheet, then good luck to you.
When I said "Education without Application Nets you Nothing", that means physically buying something or applying your education to make a decision NOT to do something. It can go either way, but if you don't invest and can't come up with a solid plan that includes inflation, discounted cash flow models, discount rate, then stick to your day job. I've lost before and I'll lose again. Fortunately I'm plus more then minus.
CheevesFinancial | Cushman & Wakefield - Commercial Property SW FL
http://www.CommercialRealEstateVoice.com
Email Me | Phone MeFlorida Housing
The state housing market gained strength in first quarter 2013 with increased closed sales, more pending sales, higher median prices and a tighter inventory of homes for sale compared with the same quarter in 2012, according to housing data released Thursday by Florida Realtors.
"The first three months of 2013 demonstrate that Florida's housing market is gaining momentum and continuing to bolster the state's economy," said 2013
Read more here: http://www.bradenton.com/2013/05/10/4519217/states-home-sales-gain-momentum.html#storylink=cpy
John-USA-CommercialRE
Email MeThese are 2 articles where 2 major Fortune 300 companies are investing in Florida. Where? My own backyard. This is very exciting for the local economy which has already spurred interest from developers. Our inventory of localized vacant commercial and favorable land use properties are practically all tied up with developers since these announcements. We have a massive interest from ALF developers (assisted living facility), multi-family, etc.
Florida provides low cost of living, emerging and re-emergine metropolitan areas, and no state sales taxes. To boot, you also get to be within minutes of some of the most reknown beaches and tourism areas in the world.
CheevesFinancial | Cushman & Wakefield - Commercial Property SW FL
http://www.CommercialRealEstateVoice.com
Email Me | Phone MeThe thing I also like about Florida it the fact that all the main cities are around a 2 hour drive from each other. So all the centers are close. I like Orlando because it is in the center of the tourist areas which are located in Orlando because its 2 hours inland so does not get the extreme weather
Nigel Kibel | Property Know How
http://propertyknowhow.com.au
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Nigel:
I understand your bias, but with regard to the weather, it has holds very little weight. Orlando is Disney. The economic draw is positive and the trajectory arrow is pointing up like most areas of Florida. You like it because you've been there and may be a fan of Buzz Light Year. I am.. The weather comment is old and not once in the last 2 years have I had a developer or investor concerned about the weather. Hurricane Charlie was 2004 and the worst storm since 1992 Hurricane Andrew. I was here for Hurricane Charlie and lived on the water where the storm surge was supposed to be over my house. It didn't even break the top of my seawall. Hurricane Wilma in 2005? What a joke. I was baking brownies in my house later that evening watching satellite TV.
You may think I'm being sarcastic, but I'm really not. Orlando is a good area. But to say that it favors other areas due to weather is an indication that you just don't know the area or the true weather patterns.
CheevesFinancial | Cushman & Wakefield - Commercial Property SW FL
http://www.CommercialRealEstateVoice.com
Email Me | Phone MeA flood always reveals the high ground. Everything that can moves to the high ground for survival. At first it appears the high ground is an opportunity but unless it can support itself it soon becomes evident that this island could simply be a trap.
Florida will look good for a while until it doesn't.
Cheeves
Most most important thing is that all main cities are only 2 hours away from each other. I have also been to Jacksonville which is good. So your right I am going on my own experience but am sure that most of the other cities are good as well.
Nigel Kibel | Property Know How
http://propertyknowhow.com.au
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Cheeves what was in those brownies. Out here in Oregon we have special ingredients.
Hinrichs: You still sitting on your wallet? When did they let you out ? I'm representing a new ALF in town. I have a room picked out for you, with a window. Let me know if you're interested.
CheevesFinancial | Cushman & Wakefield - Commercial Property SW FL
http://www.CommercialRealEstateVoice.com
Email Me | Phone MeCheeves. After my giants won the pennant I got busy,,,, good to see Balt. Coming out strong this yeyears have been doing some mez financing in fla. along with a longer term financing play… Hope all is well in your world
My brother's fund absolutely killed it the last 2.5 years in CA with hard money rehab funding. They started exiting that market though about 4 months ago with concerns that prices are getting too crazy. You see that too? I've seen some files and it reminds me of each area I know the market. Investors swooping in and OVERPAYING on almost everything. It's fueled preconstruction whispers.
I love Bucky Showalter. I met him many times when I played and he is a very smart man. I wouldn't put it past him to take Balt to a World Series in the next 3 years if he stays. Yanks keep grinding despite being old and injured.
CheevesFinancial | Cushman & Wakefield - Commercial Property SW FL
http://www.CommercialRealEstateVoice.com
Email Me | Phone MeOur PDX market is as hot as 2006 right now. Our values on the medium did not crash like most of the US… But we are a 3 to 6% net yield market.
i think the major difference right now is the preponderance of cash sales. Hard to bubble if props have no debt.
i had a great sports year though. giants win it all 49niners in the superbowl and almost pulled it out
e mail me i would like to have some off line chats. [email protected]
The chart says 2030 for SW Florida? Of course the government always revises numbers don't they.
– And Cheeves said until an investment banker reintroduces "No Income Verification loans". If you are in financing in NJ, you should be aware they are back and mainly in NJ,NY, MA, CA markets. I always see this one guy in central jersey advertising and send prospects to him. With financing coming back for residential, prices will go back up and tail off as rates go up. I see the Multifamily market slowing once that happens as the home buyers move into homes instead of renting. You know how the cycle goes.
W-W-WHAT??!! Falkner, come to me with some respect my man! I'm a real estate agent. I NEVERRRRR EVER ONCE TOLD A LIE!!
Let's be clear as to who is capable of qualifying for No-Income loans. NINA (No Income No Asset Verficiation) does NOT exist…ANYWHERE….IN THE WORLD!! Unless it's hard money. . SIVA does exist (Stated Income / Verify Assets). This is not available to W-2 employees, however if you are a 1099 independent contractor AND a business owner, then you have a chance of qualifying for HCSB's program for SIVA. You need 35% down and 12 months of reserves put in escrow. The rates suck too. It makes no real investment sense to use this type of loan in my opinion.
Show me a lender who does W-2 employees on a Stated Income loan with competetive rates, and I'll show you a portfolio lender that won't last 3 years…And that's being generous. Fannie/ Freddie won't offer this product anytime soon and if the economy is lucky, never ever again. You want a house. Show us you can afford it. These subprime loans almost wiped out the US Economy by itself! Ain't happening on a concerning level in my lifetime. I would say in Jay Hinrichs lifetime, but he's old and that's not sayin much…
COME ON JAY, I'm joking Wednesday afternoon humorCheevesFinancial | Cushman & Wakefield - Commercial Property SW FL
http://www.CommercialRealEstateVoice.com
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