As interest rates are creeping up and if you are borrowing at 5% interest, how do you make money purchasing a 4/5 cap property? Is it by hoping that rent growth increases and cap rates start to rise? Essentially the market decreasing purchase prices of these assets?
What is your or your company’s strategy of buying property in this type of environment to hedge yourselves? Waiting for the next downturn?
Buying a 4 cap in New York City and borrowing at 5% interest seems like you are relying too much on appreciation... we’ve seen what happened with that.
