Cost/income ratio for investment prop

[Rj Kro]

hi all, im wondering if any of you may be able to weigh in on a question i have. im considering an investment property, and want to try to gauge what is a reasonable/standard/expected "sale price-to-rental income" ratio.

in short, the prop is currently generating 29k annually(3 unit prop), and will be roughly 200k+closing costs. about a 14.5% ROI. i have looked into other props in the neighborhood, and at the list price and rental prices, this seems about average, usually somewhere around 12-18%.

i posed this question on another RE forum, and the only response i got was someone who thought that i could see a return on 200k at around 40k annually, and suggested i look outside my area. this seems high to me, but i dont really know what's "par for the course". fyi, i would estimate that FMV for this prop would be closer to 150k based on past sales, but there arent any 3-units in the area for sale, so its really hard to compare apples to apples with this particular place. thanks for any numbers you can throw out!