Purchase price of a multifamily

[William J Stratton Jr.]

I have a triplex. It is appraising at $120,000. How much should I try and purchase it for? I have heard to try and purchase the property for 10% less than what it is worth. 

[Bryce Lee]

The closest I think you will find to a rule of thumb is the 1% rule. The property should rent monthly for 1% of the purchase price. 

However rules of thumb should really only be used to identify potential opportunities. Once you have a deal in your sights you need to get as much information as possible and really work the numbers. If you do the math, the math will tell you what to do.