The most common way of determining value in multi-family residential buildings, and in most commercial and industrial buildings as well, is by multiplying the rent. Typically, a GIM for gross income multiplier) is used. For example, if the GIM happens to be 12 and the gross annual income from rents for a project is $150,000, then the approximate purchase price should be 51,800,000. (just multiply 5150,000 times 12.)

( This slow down is nothing new )
It is kind of like the stock market : Cyclical, and just seems to happen every ten years. The market ( especially in Phoenix ) will be back with a vengeance within a few more months. We have the weather that most other states would
cherish . Not to worry !

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Enough already with comparisons to last year. Last year was a convergence of factors, low interest rates, low prices, low inventory, and a frenzy of activity. That is in the past, but most sellers, and sorry, their realtors too, think that their homes are worth more than the market indicates. That means correction. Like the earlier post, markets are cyclical, but like the stock market, it does go down, too.

Some people were asking whether they should wait now that interest rates are rising, here are some quick calculations:

$625,000 house
20% down payment: $125,000
total mortgage: $500,000
30 year mortage rate 6.5%
Total payments: $1,137,722
Total interest: $637,722

$625k-10% price reduction= $562.5k
total mortgage-20% dn.pymt:$450k
30 year mortgage rate 7.5%
Total payments: $1,132,722
Total interest: $682,722

$625k-20% price reduction= $500k
total mortgage -20% dn.pymt: $400k
30 yr mortgage rate 7.5%
Total payments: $1,006,867
Total interest: $606,067

I think this shows it does pay to buy now even if the interest rate is better now if you see strong indicators prices are dropping…