Shoutout to my uncle who told me to stop chasing capped rates

My uncle has been flipping houses in Akron for like 30 years. When I got my first duplex under contract last spring I was so focused on getting the highest cap rate possible. I was passing up deals that looked okay but not amazing. He sat me down and said look you're not buying a spreadsheet you're buying a roof and four walls that need work. The deal I almost walked away from was a two family in a decent neighborhood but the numbers were just average on paper. I listened to him and closed on it anyway for $145k. Six months later I got an offer for $175k just because the area started picking up and rents went up $150 per unit. If I had kept waiting for that perfect 10% cap I would have missed out completely. Has anyone else had a relative or friend give you advice that went totally against the usual formulas and it worked out?

2 comments

2 Comments

bettywilson1d ago

Numbers on paper don't fix a leaky roof. You did right.

abby_robinson581d ago

Well, numbers on paper actually can help plan for the leaky roof, but you still did right by your gut...