Is this quadplex negative CAP or just over priced?

[Orlando Goodon]

Is this $800k house simply over priced? I'm new to CAP calculations, but from what I understand I should have enough data here to calculate true value of property. How do I find out what this is really worth? Key details:

Price: $800k
Total gross income: $81k
Total gross expense(Tax is $1600/mo or $19k/yr!!, plus water, sanitation, insurance, internet, gas/electric[owner] ): $30k
Mortgage with 3.5% down: $42,804

Last sold potentially 10+ years ago (So could be cash flowing nicely on MUCH smaller mortgage)


So with 3.5% down, I see this house losing $1100/mo or a loss of $13,200. Please let me know what this house should be worth and share how you calculated it. Also, tell me what you think of this deal. Additional details:

Apartments all updated
Washer drier
Building looks pretty good
All apartments have lake & mountains view
There are apartments listed for $2000-$2200 nearby without water views. Many are $1500-$1800
Nearby schools are B or C rated
1.5hr from NYC. Could approach 2 hrs on bad days, but I've done that going from Hackensack to NYC, although a bad day is typically 1.5hrs. Lots of full trains, train delays the tunnel traffic for Hackensack to NYC. However, on good days, it's an hour. The quadplex is 1.5hrs on good day...

[Immanuel Sibero]

Cap rate is meaningless when properties trade using recent sales comparables (i.e. which 4plexes generally do). Stick with COC and make sure you cashflow. Cap rate is a metric used in commercial real estate, even then there is no such thing as a "good", "bad", "decent" cap rate. If anything cap rate is a measure of how bullish or bearish investors feel about a particular market (i.e. more of a measure of investor sentiment/posture).

Cheers... Immanuel