If you are interested in selling your apartment building you basically have three options:
1. Hire an Agent and Pay Commission
2. Act as Your Own Agent (and take on all the work)
3Â Sell Directly to a Professional Apartment Buyer.
When you list an apartment with a real estate agent, you agree to pay commission based on the sales price. If you want to avoid the 5 percent to 6 percent commission fee and maximize your profit, opt to sell the apartment building yourself.
If you decide to sell apartment building yourself, you have two options;
a) You can take on 100 percent of the workload by acting as your own listing agent; advertising and promoting the property, taking numerous calls from "buyers" (who  may largely be unqualified), showing the property, opening title/escrow account,  negotiating price and closing the deal.
b) You can sell apartment building directly to a professional apartment buyer who is well qualified to purchase your apartment building, will help with the entire closing process and pay all closing costs! Â And, you will avoid paying commission fees. The sales process of dealing directly with a professional apartment buyer is the easiest and fastest way to sell apartment building. Â
If you decide to either sell apartment yourself, or directly to a professional buyer, Â you should know how to determine its market value.
The most accurate way to determine the market value of a multi-family property is to hire an appraiser. Â However, commercial appraisals are expensive (costing thousands of dollars) and can take weeks/months to complete. Â
Therefore, most sellers of apartments need to understand how to accurately determine the market value of their asset.  To do this, they will use what is called a Market Capitalization Rate (CAP Rate) to determine the market value of  their commercial property, such as an apartment building. Â
A cap rate (capitalization rate) is a term in commercial real estate that refers to the way a building is evaluated. It’s calculated by taking the net operating income, NOI, and dividing it by the cost of the building which reflects the "rate of return" the apartment building generates relative to its market value.  Below is the simple equation:
Capitalization rate = Net operating income / Cost of the building
The cap rate is a great unifying metric because it allows you to compare different building types, market areas and asset classes at a glance and quickly determine how the asking price is valued based on the income an asset generates.
Since the NOI is reflective of the annual net income generated by the building, this number can also be used, in an inverse manner from the above equation, to establish a market value. Â Simply divide the NOI by a Market CAP Rate (expected rate of monetary return) to determine market value. Â
Market Value = Net Operating Income (NOI)/CAP Rate (percentage)
Another, quicker, easier, way to determine the price of your apartment building is to look up comparable sales in the area and determine what the price per door is. Â You can do this by simply dividing the sales price by the number of units. Â Assuming the configuration and market is comparable to both properties, this can be an easy way to measure approximate value. Â
Should you decide to sell apartment building yourself and use a direct buyer ,it is advisable to know the market and what the going cap rates are for that market. Â This way you can determine the approximate value of your apartment building without relying on the opinion of others.
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