👋What is Considered a Good Multifamily Cap Rate?

[Justin Goodin]

What is Considered a Good Multifamily Cap Rate?

The short answer is it depends!

There’s no universal standard since it relies on two main variables–your investing objectives and current market conditions.

Some key factors influencing a good cap rate include:

/ Property location
/ Building condition
/ Asset type (class A, B, C)
/ Overall real estate market dynamics

Taking these into account helps set realistic cap rate expectations, but historically, rates between 4-10% are often seen as solid.

Of course, a “good” cap rate for you might fall outside that range based on your investing goals and the specific property/market, so don’t get hung up on chasing a specific cap rate number.

What is a good cap rate for your market?

[Trevor Richardson]

In Reno, NV a good cap rate for stabilized multifamily is 5-5.5%. That means it’s new or a renovation was done.

We have seen some proforma cap rates hit high 7s or even 8s like a deal we just closed in Carson City (8units).

Basically since high interest rates northern Nevada has moved a full 1% up.