Southwestern Ontario Cap rates

[Jim Noseworthy]

So I’ve been looking at house prices across Southwestern Ontario over the last month, and I’m trying to figure out some of the numbers. BP would suggest for a rental, to use the 1% rule. With house prices the way they are, and existing rents, it’s virtually impossible to get 1%. What number is everyone using for quick calculations?

Also, when it comes to cap rates, is 6-8% a reasonable level? Or should I be aiming higher still? Seems I might pass on a lot of properties if I continue to wait for the numbers to get better.