Most investors think price equals value.

They look at comps. They trust broker packages. They assume appreciation will fix everything.

That's where they get into trouble.

In this episode, I sit down with Ryan Cadwell, Principal of Resolute RDM, an Indianapolis-based firm involved in over $100M in transactions, development, and asset management.

Ryan has flipped nearly 150 homes and is currently developing more than 240 duplex units. He breaks down what he calls the "$100M mistake" — confusing market price with investment value — and why overly optimistic underwriting is putting investors in difficult positions.

In This Episode, You'll Learn:

The difference between market value and investment value
Why buying strictly on pro forma is dangerous
How brokers use optimistic assumptions to justify pricing
The underwriting mistakes investors made during low interest rate years
Why today's market is a capital game
How flat rent growth is exposing weak assumptions
The long-term math behind 3% rent growth
When time can fix a mistake — and when it cannot
Why "$100 under market rent" is often misleading
How to evaluate rent growth assumptions realistically
The role of opportunity cost in deal evaluation
Why disciplined underwriting matters more than ever

Market Value vs. Investment Value

Market value is what the seller wants and what brokers are marketing.

Investment value is what the property is worth to you based on:

Your opportunity cost
Your tax situation
Your capital stack
Your required return
Your hold timeline

If those do not align, the deal does not work.

The Pro Forma Problem

Many investors:

Underwrite 3% rent growth
Underwrite 2% expense growth
Assume stable refinance rates
Assume quick lease-up

When even one of those assumptions fails, the entire deal breaks.

In flat rent markets, optimism gets expensive fast.

When Time Is the Only Fix

If you overpay, time may be your only exit.

Longer holds can allow:

Wage growth to catch up
Rents to normalize
Market cycles to reset

But only if you have enough capital to survive the wait.

AI in Underwriting

Ryan also shares how he uses AI tools like Claude and Gemini to build custom deal analyzers that:

Rank opportunities
Evaluate opportunity cost
Compare lending structures
Stress-test assumptions

The key is not just using AI. It is learning how to prompt it and integrate it into your workflow.

Connect with Ryan Cadwell

Website: resoluterdm.com LinkedIn: Ryan Cadwell Instagram / TikTok: Resolute RDM

Today's episode is brought to you by Green Property Management, managing everything from single family homes to apartment complexes in the West Michigan area.

livegreenlocal.com

And RCB & Associates, helping Michigan-based real estate investors and small business owners navigate the complex world of health insurance and Medicare benefits.

rcbassociatesllc.com