Rent Resiliency™

Rent Resiliency™

Average Rent Resiliency™ Percent

Rent Resiliency™ is the amount rent can decline before you have negative cash flow on rental properties. We can measure it in terms of dollars or in terms of percent. In other words, we can ask: How many dollars can rent decline before I’d have negative cash flow? Or, what percent can rent decline before I’d have negative cash flow? When we talk about Rent Resiliency™ in dollars, what we’re really talking about is Cash Flow. That’s because Cash Flow is the amount of dollars that rent can decline before you’d have negative cash flow. But, the idea of Rent … Read more

Rent and Price Resiliency for Real Estate Investors

Topics discussed include: What is resiliency? What is Price Resiliency™? What is Rent Resiliency™? The two flavors of resiliency: dollars and percent. Measuring resiliency on the individual property basis or the entire portfolio Measuring resiliency as a snapshot in time or over time Examples using over-simplified math: What happens when rents go up 10%, down 10% in two different portfolios? What happens when prices go up 10%, down 10% in two different portfolios? Resiliency is largely about leverage Thought experiment: what is more risky… 0% or 10% down payment? The 7 Ways to Measure Risk in Real Estate Investments How … Read more