Which cap rate would attract investors for short term SFR?

[Sam Tee]

Hello, everybody, first post here. Currently I have 3 properties in desert cities near Palm Springs, CA. I rent them all short term through Airbnb, each property brings roughly $6K each month, season or not. All of them I purchased for $350K with 20% down plus closing, reno and furniture took about $50K each. My cap rate calculation give me 12 x $6K = $72K - 36K(operating cost - mortgage, property tax, insurance, utilities, maintenance) = $36K : $125K = 0.288 = 28%, average cap rate I see between 8-10%, that's pretty much high in my case.  I have couple properties for sell which fits purpose and I need an investor/partner to go 50/50 or 30/70? Thank you

[Mike Dymski]

I'd recommend including management cost in your return calculations so that you are not mixing pay for your services in your investment return.  Should consider including cap ex reserves as well.

Cap rate does not include the mortgage payment.  What you are calculating is the cash-on-cash return.