Help me underwrite! Focus on CoC, IRR, or ROI?

[Evan Swanson]

When underwriting properties, I look for a 5-year ROI of >100% and an IRR of >12% (screenshot below of how those are defined). Please let me know if this is off-base.

I am familiar with valuing companies, and I think these are the minimum returns needed when compared to alternative investments like the stock market. 

Should I be paying more attention to CoC return?

Below is a picture of a duplex I evaluated. The CoC is terrible. But the 5-year ROI and IRR look okay.

My goal is to hold the property long-term. 

Please help! 

ROI

[Samuel Eddinger]

@Evan Swanson - I own quite a bit of real estate in and around Middletown, CT (the area you are analyzing). My take on underwriting is to never believe the numbers given to you. I could be wrong but I don't believe that property is a 6.5 CAP (at that price) when you consider all the areas that should be put in underwriting guidelines. I am extremely conservative with my underwriting which is why I am not buying in this market.

Does your underwriting include, CAPEX, vacancy, bad debt, property management, etc? If not, like everyone else buying in this market you are going to lose. I'd be happy to talk about this if you want to DM me.