So I have done a lot of research/reading in evaluating a multi family for buy and hold such as determining cash flow, cap rate, cash on cash return utilizing the 50% rule for expenses and pro forma numbers. I am just wondering do these same principles hold true for single family homes? Should I expect less for expenses like maybe 60/40 since we are dealing with one WH/HVAC/appliances etc. and less of a vacancy rate? Or is their another formula used to evaluate a good vs. bad deal in single family buy and hold scenarios. What kind of cash flow do you look for in your market for a single family home?
Also when making a first deal I know Brandon states he likes to see $100 per unit cash flow with nothing down and $200 if he is putting money into the deal. As a first time investor in a multi family deal would you suggest trying for more or less cash flow and why?
