One percent rule, CAP Rate, and COC return.

[Isaac Gougler]

Good Morning All,

I just moved back to Cache Valley recently and I'm trying to determine what a good deal looks like to me. I'm new to investing. I own a home in Kentucky that's rented and a home in Cache Valley that I live in. I have some savings and I'm going to get a HELOC on my house in Kentucky to raise a down payment for a MFR in Cache Valley.

My question is for those that buy MFRs in Utah, how often do you find property that fits the one percent rule and do you follow it? What CAP Rate, COC Return and ROI would you consider worth it to purchase?

Any advice would be much appreciated. 

[Aaron K.]

That is a tiny town.  Unfortunately you will have to figure this out on your own by analyzing quite a few properties before making any offers.  A lot of investors that have rules like this are big enough to buy anything that they see meets their standard and thus aren't going to love sharing that number.  After analyzing properties you should get a good feel for what is possible, and what is a good deal in your market (it's all relative)