Master Class · Thursday, November 19, 2026
How to Buy Discounted Apartments in 2026
Swapnil Agarwal, Founder, Nitya Capital
Important information
- Educational session only
- Not an offer to sell or a solicitation to buy any security
- No investment is presented tonight
- Past results do not guarantee future results
- Tax points are general; confirm with your own CPA
Wording to be approved by Nitya's counsel
Tonight's agenda
- Why owners are forced to sell
- Inside a Nitya acquisition
- Rates and the supply decline
- How to evaluate a sponsor
- Cash flow, underwriting and tax
- When I would not invest
Q&A
Your questions, answered live in the final 20 minutes
About Nitya Capital
$2.9B
Real estate portfolio
4,000+
Investors
More than half
Are repeat investors
HoustonIn-house construction and property management
Nitya Capital
Why owners are forced to sell
$2.3T
Apartment debt outstanding
$757B
Maturing between 2026 and 2028
2021–22
Short-term, floating-rate loans
What changed
- Rates rose and rate caps are expiring
- Replacing a cap costs far more
Where the pressure is
- Bridge and CLO loans, not Fannie Mae or Freddie Mac
- Extensions delay the sale, they do not prevent it
Where the discount sits
The property
- Below its last sale
- Below the cost to build, commonly $250,000+ per unit
Rescue capital
- A new investor funds the existing owner's gap
The loan
- Bought from the lender
Nitya todaySwapnil to confirm: the property, rescue capital or the loan, and why
Inside a Nitya acquisition
| Property · units units · city | Figure | Compared with |
|---|---|---|
| Price per unit | price | last sale, year |
| Cost to build today | cost per unit | |
| Financing | fixed or floating, rate | maturity |
| Day one | coverage× debt service | Net operating income |
| Plan vs. actual | plan at purchase | result |
| Source of return | price, operations or market |
Past results do not guarantee future results · figures to be supplied and approved by Nitya's counsel
Higher for longer
5.31%
10-year Treasury, peak close in October
Above 5%
First close above 5% since 2007
3.7%
Inflation in September
Negative leverageWhen a building yields less than its loan costs, borrowing lowers the cash return. Underwrite to today's rates.
U.S. Treasury, daily par yield curve (closing basis) · U.S. Bureau of Labor Statistics, CPI
The supply decline
Apartment starts, buildings with 5+ units
What it means
- Buildings take about two years to complete
- New supply is lowest in 2026
- Still well below 2022 in 2027
- Use net effective rent, after concessions, not asking rent
U.S. Census Bureau, New Residential Construction, annual starts
How to evaluate a sponsor
Track record
- Projected against realized results
- On every past deal, including losses
Alignment
- The sponsor's own capital in the deal
- What remains after fees
The five-minute stress test
- Refinance at today's rateDebt service coverage, debt yield, repayment of the balance
- Rate capThe cost to replace it
- ReservesMonths of debt service covered
- Capital callsWhat happens if you do not fund
- GuaranteesLoan guarantor, key-person and removal provisions
Cash flow and underwriting
Distributions
- Paid from cash flow, or from reserves and investor capital
- Preferred return: simple or compounding
- The sponsor's catch-up
Underwriting traps
- Three months of income multiplied by four
- Occupancy instead of rent collected
- Property tax reassessment and insurance after the sale
Tax points
- 100% bonus depreciationRestored for property acquired after January 19, 2025
- Cost segregationParts of a building depreciated over 5 to 15 years
- Recapture on saleOrdinary rates on short-life assets, up to 25% on the building
- Passive lossesOffsetting W-2 income rarely applies to limited partners
IRS Notice 2026-11 · IRS Publication 925 · general information, confirm with your own CPA · subject to Nitya's CPA
When I would not invest
- A floating-rate loan maturing in the first few years
- A low price for a reason: deferred maintenance or heavy new supply
- A plan that only works if rates fall
- Distributions paid from reserves
- Capital you may need back before the hold period ends
A deal we declined
- Deal
- The deciding figure
One that underperformed
- Deal
- What we changed
Introductory call
See how we apply this today
Book a short introductory call · the link is in the chat
Booking link
Q&A
Your questions
Thank you for joining us tonight