Formula for finding value of small apartment complexes (What would I pay)

[Casey Stuebs]

Hi all, this may be answered someplace else but I couldn't find it. Josh and Brandon mention when looking at apartment buildings you base the value off of the current rent price. Hypothetically if there is a building with 10 units that rent for $500 each with vacancy rate of 10% so the property brings in $4,500 per month, $54,000 per year. How many years income do you pay for the property? Any guidance in this is much appreciated.

I'm not looking to make a move on a 10 unit building soon but I just want to know so I can calculate it in my head and learn while driving down the road.