Please Explain Cap Rates
Would someone please explain what a cap rate is? I understand it has to do with a percentage of income vs. ???? What is a respectable cap rate for a 8-12 unit apartment building?
Thank you very much :-D
This may help:
http://www.thecreativeinvestor.com/commercial/modules.php?name=News&file=article&articleid=467
Thanks alot fmmp!!
Your link explained alot to me and more. I appreciate you taking the time to provide me with the info.
Ok, so when I was but a young man the old german fellow had a simple formula:
Anybuilding anywhere anytime is worth a 10% cap rate.
11% is a good deal
13% is a very good deal
at 15% you should come get me.