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Updated over 2 years ago on . Most recent reply
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Overall average yearly return for rental properties
hi,
I've been trying to find online an average percent return yearly on a rental property. I am looking for what the percent would be with typical situations. average positive cashflow monthly from rent and appreciation of the property. And anything else that adds value that I've forgotten about, all rolled up into a ballpark average guess of a return.
hopefully this question made sense
Most Popular Reply
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that is going to be difficult for someone to give average percentage returns because they will vary on a multitude of factors.
You can have standards based on your area.
for us in chicago suburbs we have the following standards.
We only buy in B or B- areas
After rehab on rental we want a minimum equity position of 25%
Single family rentals: Cash on cash return a mininum of 35 -40%
Cash Flow per month after all expenses: $ 350 - 400 per month.
In the midwest the appreciation is about 3-6% but we consider appreciation as zero. We take a inflation factor of 3%.