Returns on 4 unit turn key Apartments in your area

[Austin Luepkes]

What kind of cap rates/rent to price ratios/whatever are you seeing in your area on the mls? Specifically 4 unit apartments. I'm seeing them with cap rates of like 6.5% (using the 50% rule for expenses) and I live in a small town. I'm trying to decide if its worth paying a 6-7% cap price or if everyone else is getting them at 9%. I bought a 14 cap and a 11 cap in these past several months but those were rare deals and I've been hard pressed to find anything similar.

[Austin Luepkes]

@Barry H.

The 50% rule is basically just figuring that Net operating income will be 50% of gross rent revenue. So if your 4-plex rents for $32000 a year, your actual income would be 16,000 a year