Originally posted by @Account Closed:
@Cody L. you can definitely find 10% COC all day, I'm trying to say that that is way too low. Especially on a small deal. A lot of buyers have very low standards for qualifying property, and it's a problem. It's how people get burned. I recommend investors seek out a 10 cap using a REALISTIC pro forma. That usually comes out to a 18%-20% cash on cash return with good financing terms. Lower could work, like with your houston house, but I would only recommend that if someone feels very confident that incidental expenses with the property (vacancy, maintenance, etc...) are going to fall in line with your pro-forma estimates.
Another thing that scares me about lower yields, esp in major markets, is that we're at a peak. Major markets tend to see depreciation and weaker rental demand during low economic cycles. It's nice to have a buffer for that built into your cash flow.
The point I'm really trying to drive home is it's on the buyer to make sure they're making a good investment, and not to assume or trust that a provider or seller of any sort adheres to high ethical standards (they should, but it shouldn't be assumed).
Now if you're saying MLS vs TK... That's just a matter of do you want the additional service a provider offers or do you want to do it yourself, which is more of a preference thing than a performance thing so I don't think it speaks to the