Posted by Ed on November 12, 2002 at 20:09:37:
I use my NOI and divide it into my asking price and get my cap rate. You set your standards as to what you want your cap minimum to be.I prefer 9.50% or higher for me to go look at a property with a cash flow of ATLEAST $125 per house or $100 per unit if more than a 2 family (per month)… I use a 25% expense ratio to the EFFECTIVE GROSS