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NOI First, Price Second
Want a cleaner way to price your offers and plan your exit without getting lost in broker fluff? We break down three real multifamily deals and show how net operating income lets us back into the right purchase price, size the debt, and forecast cash-on-cash before we even see a T12 we can trust. The theme is simple: value lives in NOI, and leverage only works when the cap rate beats your cost of debt.
We start with a 20‑unit in Georgia marketed at a 5.25% cap. On paper it throws off roughly $145K in NOI, but at 85% occupancy and thin expenses, the cash flow after debt shrinks to about $11K on a $750K down payment. By normalizing expenses and pushing the cap to a 6% target, we reprice the deal near $2.4M, reduce debt service, and lift annual cash flow toward $35K—with a clear upside path as occupancy improves. Next, we pressure-test a 16‑unit Florida property pitched at a 7.3% cap with expenses around 25%. We reset to a 40% expense load, model 95% occupancy, and show how a $100 rent increase across 16 units adds roughly $19K to NOI and about $270K to value at the same market cap, creating real refinance or sale options.
The final deal comes with spotty data, so we build it from first principles: realistic rent, 40% expenses, and a 7% unlevered target to set price near $1.786M. With 25% down and 6.5% debt, levered returns land above 8%—and we outline how minor rent alignment can compound results. Along the way, we share key rules of thumb: if the cap rate is lower than your all-in debt cost, your cash-on-cash will suffer; if cap beats debt, leverage can amplify returns safely. NOI divided by target cap sets the offer. Purchase price times cap yields NOI. Those two loops keep your underwriting honest, your offers disciplined, and your exits realistic.
If you’re ready to underwrite smarter and buy with confidence, hit play. Then send us a deal on Instagram at Dale Kearns Jr so we can review it together. If this helped sharpen your process, follow, share with a friend who’s hunting apartments, and leave a quick review to support the show.
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By Dale KernsWant a cleaner way to price your offers and plan your exit without getting lost in broker fluff? We break down three real multifamily deals and show how net operating income lets us back into the right purchase price, size the debt, and forecast cash-on-cash before we even see a T12 we can trust. The theme is simple: value lives in NOI, and leverage only works when the cap rate beats your cost of debt.
We start with a 20‑unit in Georgia marketed at a 5.25% cap. On paper it throws off roughly $145K in NOI, but at 85% occupancy and thin expenses, the cash flow after debt shrinks to about $11K on a $750K down payment. By normalizing expenses and pushing the cap to a 6% target, we reprice the deal near $2.4M, reduce debt service, and lift annual cash flow toward $35K—with a clear upside path as occupancy improves. Next, we pressure-test a 16‑unit Florida property pitched at a 7.3% cap with expenses around 25%. We reset to a 40% expense load, model 95% occupancy, and show how a $100 rent increase across 16 units adds roughly $19K to NOI and about $270K to value at the same market cap, creating real refinance or sale options.
The final deal comes with spotty data, so we build it from first principles: realistic rent, 40% expenses, and a 7% unlevered target to set price near $1.786M. With 25% down and 6.5% debt, levered returns land above 8%—and we outline how minor rent alignment can compound results. Along the way, we share key rules of thumb: if the cap rate is lower than your all-in debt cost, your cash-on-cash will suffer; if cap beats debt, leverage can amplify returns safely. NOI divided by target cap sets the offer. Purchase price times cap yields NOI. Those two loops keep your underwriting honest, your offers disciplined, and your exits realistic.
If you’re ready to underwrite smarter and buy with confidence, hit play. Then send us a deal on Instagram at Dale Kearns Jr so we can review it together. If this helped sharpen your process, follow, share with a friend who’s hunting apartments, and leave a quick review to support the show.