albany ny area cap rate

[Brandon B.]

I recently purchased a duplex in the good part of Albany for what was certainly under market as the seller was distressed. He had no money and had occupancy permits due with $10k+ needed in renovations. However, I am curious what the cap rates are in the area. Do properties in this area normally just sell at the 1% rule, or is there a slight premium or discount from that. For example, $2400 a month in rental income selling at PERFECT condition should yield what price? I have yet to see a property on market that needs less than $10k of work.

[Nate Monson]

Hey @Brandon B. cap rates generally float between 6 and 8 percent I would say. If you have a property with $2400 in monthly income I would hope that you got it for less than $240,000. I had a client who bought a property for $250,000 and he is getting a little more than $3000 per month. Albany certainly has it's fair share of older properties that need work so if you're factoring that into your "purchase price" the cap rate's will probably get closer to the 6's for you.