Updated over 11 years ago on . Most recent reply
Minimum acceptable return
A broker sends me a constant stream of listings off of the NJ MLS system for the areas property I'm interested. Most are immediate discards, but occasionally one catches my eye. One did today.
I did a quick calculation of cash on cash return, based on the pro-forma numbers in the listing (and, yes, I know these would have to be confirmed in due diligence.) Assuming a 5% interest rate, I get about a 9% return.
This seems a little thin, but it's way better than any other kind of income investment right now. There may be room for rent improvement, but it might be a bit tough for a few reasons.
What do you consider a minimum viable return?