Multiply that by 6 and I could have 12-15 Homes/duplexes to rent.  

Many people will also base it off of the 1% rule or Gross rent multiplier.

Given his situation, if he is good, with the right partner that $20K could have some hefty multipliers.

Making sure I understand, I would take my added up rent $2,200 and multiply by 23% 2,200 x .23= 506 a month towards, Vacancy 8%-$41 Repairs 5%-$25Capex 10% - $51(which is the roof, Furnace, water heater, floor, kitchen and bath appliances).

Higher price = bigger loan = higher mortgage payment = less cash flow when rented.More Units = More Cash Flow -- I recently completed a thorough analysis of the multifamily properties available in the Sacramento area, and the only properties that passed the 1% Test (monthly gross rents close to 1% of purchase price) or had a Gross Rent Multiplier of 10 or below (time in years it would take for property's gross rents to pay for the purchase price of property) were all multifamily units, and more so 3-4 plexes.Financing is the Same as Single Family Home -- there's no added loan requirements, and you can still qualify to purchase the property with FHA or VA loan if you so choose (thank you for your service by the way!)

They are using an approach called Gross Rent Multiplier where they use the gross annual rent of the property to determine property value.

In some areas, you have to count up the tax stamps and multiply by whatever value each tax stamp represents.

In fact, a lot of buying good investment properties is to find properties with a low GRM (gross rent multiplier).

So I multiply that by 3 times that I will be sending them my marketing post cards.

In this case, a contractor who seemingly gave a low bid to get the job and then tried to multiply it by 5.