Are Lower CoC returns Worth It?

[Lisa Oliver]

Hi, I'm a new investor. I'm looking for 2-4 door units. I've analyzed 50-100 of them and the good ones have CoC return in the 4% range if I use cash and 1-2% with financing. Of course I've heard so many times, just get in the market.

To the more seasoned investors…what would your advice be?

Thanks!

[Scott E.]

Sounds like your market is in the same condition as my market. Cap rates are very compressed in small multifamily deals right now. And in my opinion, not much more room to raise rents which is a problem.

Above poster gives good feedback about looking at other markets if cash flow is your goal. I personally wouldn't deploy any capital long term right now unless it was yielding ~7%+ cash on cash.