Cap Rate Vs Cash on Cash Vs 1% Rule

2 Replies

I am wondering what you use to determine what is a good deal for you.  I generally get clients looking for a 7% or greater cap rate, but then I get a few clients that only buy if they are achieving a 10%+ cash on cash.  I also have a small group that keep it very simple and use the 1% rule. For you that may not know that is 1% of the total cost of the properties monthly rental income (example $100,000 home renting for $1,000).  What do you use and why?

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