Rental Property Return Rate

[Ric Mittleider]

As a general Discussion, What do you consider to be a realistic expectation for Cap Rate in the area? Or if you use a different ROI calculation what is it and what rate do you expect to get? I see a lot of 6-7% out there that seems low to me.

[Michael Haas]

As crazy as it sounds, 6-7% CAP in the greater puget sound is actually quite good. Seattle averages in the low 5%s and tacoma in the low 6%s or high 5%s.

That's the current CAP of course, so for those properties (or any property) most investors would be looking to add value and increase returns after purchasing.