The Nick Huber Show Ep 182: The real cost to buy and sell real estate
Feb 18, 2025
A deep dive into why real estate’s illiquidity shapes investor behavior. A walkthrough of typical transaction timelines and risks. A detailed breakdown of buyer acquisition costs and all-in purchase math. An analysis of seller fees, taxes, and how transaction costs erode realized returns.
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Expect Six To Twelve Month Transaction Timelines
- Prepare for long timelines when buying or selling — expect six to twelve months including marketing, due diligence, and closing.
- Nick notes specific tasks: OM prep, gathering P&Ls, tax records, and 45-day marketing windows before contract.
Deal Structures Encourage Frequent Turnover
- Real estate private equity structures incentivize transactions because sponsors earn carry and promote on sales.
- Nick warns this encourages frequent buying/selling and turns many sponsors into service-business owners reliant on deals to earn.
Deal Example With Third-Party Due Diligence Costs
- Nick walks through a real-world acquisition example: $373k NOI and $5.75M purchase price at a 6.5% cap.
- He lists baseline third-party reports: three appraisals ($15k), environmental and property condition reports ($5k each).