Wheel Street Journal #2 - Financing

The secret is out; sometimes people hang up on us. We make many, many cold calls every week and have reached a point where we need to address a common thread that runs through every call, and it's all about financing. The oversimplified calls often sounds like this:

Investor: Hello?
Wheelhouse: Hi, Pam, this is Toby from Wheelhouse. Are you in the market to acquire another apartment building?
Investor: Toby, in case you haven't read the news, lenders are under water and loans are all but non-existent...
Wheelhouse: Believe it or not, Pam, the average interest rate is finally below that of the average bay area cap rate...
Investor: Stop the propaganda, Toby. *click*
Wheelhouse: Pam? Hello?

Consumer credit is undeniably tight, and lending to institutions who were used to 85% loan-to-value is skinny, but loans for the private investor with good credit are more attractive and more available than almost ever before. The graph below shows Bay Area cap rates vs. interest rates and how you can now borrow money at a interest rate lower than your rate of return.

In this edition's video, we interviewed Nathan Prouty, Senior VP with Northmarq Captial, who shed some light on the financing market. Click the video above to watch!

Category:

News & Politics

Tags:

• multifamily
• real estate
• wheelhouse
• brokerage
• whvideo2