Potential Cash on Cash Returns in today's market

Member since 2022 · 8 posts · 2 votes

Hi - on today's MLS market I am finding a lot of 6% or 7% CoC returns for single-family or duplex homes. Curious as to what the broader investors think of these returns given today's interest rates?

2 Reply

41 views

Most Popular Reply

Melissa Nash

Rental Property Investor · Orange County, CA · Member since 2016 · 740 posts · 529 votes

Quote from @Michael Naples:

Quote from @Melissa Nash:

Quote from @Michael Naples:

Hi - on today's MLS market I am finding a lot of 6% or 7% CoC returns for single-family or duplex homes. Curious as to what the broader investors think of these returns given today's interest rates?

I think you are summing up all of the markets into 1. Which markets are you looking at? There are a lot of linear markets in the US and there are a lot of high growth markets. Also what type of areas? A/B/C Class area affect your returns. I am getting 10-15% cash on cash in linear markets like Memphis or areas of Ohio with current mortgage rates. This is for B class areas.

Great point. I am in B Class neighborhoods as well. Is this 10-15% for 'Buy and Hold' Strategies or 'STR,' etc?

Buy and hold turnkey. I am hitting B class + renovated + professionally managed 10-15% all day long.

2 Reply

See this reply in the discussion

8 Replies

Jump to latestLatest

Sort by

Josh YoungPro Member
Rental Property Investor / REALTOR® / Property Manager · Gilbert, AZ · Member since 2023 · 385 posts · 421 votes
3y
@Michael Naples
That seems really high for most markets with today's rates and prices. Make sure you are accounting for Vacancy, Maintenance & Repairs, Property Management and Cap Ex. These combine could be 20-25% of rent or more depending on the property. I think most markets are negative on single-family unless you put 40% or more down.
[email protected]802-274-8121
1 Reply
Melissa Nash
Rental Property Investor · Orange County, CA · Member since 2016 · 740 posts · 529 votes
3y
Quote from @Michael Naples:

Hi - on today's MLS market I am finding a lot of 6% or 7% CoC returns for single-family or duplex homes. Curious as to what the broader investors think of these returns given today's interest rates?
I think you are summing up all of the markets into 1. Which markets are you looking at? There are a lot of linear markets in the US and there are a lot of high growth markets. Also what type of areas? A/B/C Class area affect your returns. I am getting 10-15% cash on cash in linear markets like Memphis or areas of Ohio with current mortgage rates. This is for B class areas.
0 Reply
Michael Naples
OP
Member since 2022 · 8 posts · 2 votes
3y
Quote from @Josh Young:

@Michael Naples
That seems really high for most markets with today's rates and prices. Make sure you are accounting for Vacancy, Maintenance & Repairs, Property Management and Cap Ex. These combine could be 20-25% of rent or more depending on the property. I think most markets are negative on single-family unless you put 40% or more down.

Thanks, Josh!
0 Reply
Michael Naples
OP
Member since 2022 · 8 posts · 2 votes
3y
Quote from @Melissa Nash:

Quote from @Michael Naples:

Hi - on today's MLS market I am finding a lot of 6% or 7% CoC returns for single-family or duplex homes. Curious as to what the broader investors think of these returns given today's interest rates?

I think you are summing up all of the markets into 1. Which markets are you looking at? There are a lot of linear markets in the US and there are a lot of high growth markets. Also what type of areas? A/B/C Class area affect your returns. I am getting 10-15% cash on cash in linear markets like Memphis or areas of Ohio with current mortgage rates. This is for B class areas.

Great point. I am in B Class neighborhoods as well. Is this 10-15% for 'Buy and Hold' Strategies or 'STR,' etc?
0 Reply
Michael Naples
OP
Member since 2022 · 8 posts · 2 votes
3y
Quote from @Michael Naples:

Quote from @Melissa Nash:

Quote from @Michael Naples:

Hi - on today's MLS market I am finding a lot of 6% or 7% CoC returns for single-family or duplex homes. Curious as to what the broader investors think of these returns given today's interest rates?

I think you are summing up all of the markets into 1. Which markets are you looking at? There are a lot of linear markets in the US and there are a lot of high growth markets. Also what type of areas? A/B/C Class area affect your returns. I am getting 10-15% cash on cash in linear markets like Memphis or areas of Ohio with current mortgage rates. This is for B class areas.

Great point. I am in B Class neighborhoods as well. Is this 10-15% for 'Buy and Hold' Strategies or 'STR,' etc?

Also, is this for MLS or Off-market deals you are finding the 10-15%?
0 Reply
Matt N.
Rental Property Investor · Philadelphia, PA · Member since 2015 · 94 posts · 58 votes
3y
@Michael Naples
Please don't listen to any of these people ^^^. Look at their location and ask yourself, What do they know about Philadelphia?
Just closed a duplex in Germantown that is 50% cash on cash. Utilizing the KFLEX loan program and getting some sellers assist money my buyer got in for $7000 out of pocket and the home will cash flow 300/month after factoring in maintenance, vacancy and property management.
I can show you this deal as proof... and again, ignore the people from cali or out west commenting on Philly real estate posts.
Check out my profile and if you need or want help just reach out!
1 Reply
Melissa Nash
Rental Property Investor · Orange County, CA · Member since 2016 · 740 posts · 529 votes
3y
Quote from @Michael Naples:

Quote from @Melissa Nash:

Quote from @Michael Naples:

Hi - on today's MLS market I am finding a lot of 6% or 7% CoC returns for single-family or duplex homes. Curious as to what the broader investors think of these returns given today's interest rates?

I think you are summing up all of the markets into 1. Which markets are you looking at? There are a lot of linear markets in the US and there are a lot of high growth markets. Also what type of areas? A/B/C Class area affect your returns. I am getting 10-15% cash on cash in linear markets like Memphis or areas of Ohio with current mortgage rates. This is for B class areas.

Great point. I am in B Class neighborhoods as well. Is this 10-15% for 'Buy and Hold' Strategies or 'STR,' etc?

Buy and hold turnkey. I am hitting B class + renovated + professionally managed 10-15% all day long.
2 Reply
Alan AsriantsBusiness Member
Real Estate Agent · Philadelphia, PA · Member since 2019 · 1k+ posts · 1k+ votes
3y
Hey Michael, at the end of the the day it depends where in Phila you are looking for. Some neighborhoods have some great returns but other draw backs. I generally aim for 10%+ CoC on my investments. I would be happy to connect and share with you my experience investing in the City. Fee free to reach out anytime!
[email protected]267-767-0111
Alan Asriants - New Century Real Estate 591 Reviews
View Page
1 Reply

Join the conversationCreate a free account to reply, vote on answers and follow this thread.