By Kathy Fettke, Co-Authored by Donna Behrens
Landlords and investors may feel the sting of lower cap rates in 2018. We’ve been seeing price appreciation and rent growth year after year during the economic recovery, but the economy is shifting gears and returns are shrinking. Cap rates are expected to run flat this year, or fall somewhat, depending on other economic pressures, like interest rates.
If you are a real estate investor, you know that cap rates are an important valuation tool. They can help you determine the value of a property before you buy it, and they can tell you what kind of returns on investment you are getting as you move forward.