Jonathan CroninREI Accelerator, Rei Accelerator · Multifamily Real Estate Investor & Coaching Leader

💡 Understanding NOI

17 Jan 2025

Watch on YouTube

A short YouTube talk (single speaker) explaining how Net Operating Income (NOI) increases property value. The speaker emphasizes that NOI growth depends mainly on moving rents through renovations/improvements, but is limited by the local renter pool and market ceilings for rent growth. The choice of exit strategy (long hold vs. sell after 2–3 years) affects buyer demand and acceptable renovation plans.

The key component of driving, you know, as you guys know, is you've got to drive noi to increase the value of the property. And that's driven by primarily how you're able to move rents in conjunction with renovation or improvements and things of that nature. So you inherently only have a certain amount of people that are going to be renters for that location. You also inherently have a limitation on what you're going to be able to grow rents. But exit, what's your exit? Hey, I'm going to hold it for 10 years. Okay, well, then maybe that's okay. If your exit is, I'm going to fix it up and do this and then sell it in two to three years, you'll have less buyers.