cap rate formula varies and depends on a few parameters

For the example A (SFH, simplest case), roughly,

cap rate = (annual cash flow - annual rent * 0.05) / cash down

= 12 * (400 - 1800*0.05) / 37750

= 9.854%

 

Note: The parameter 0.05 means that 5% of your rent will be lost for vacancy and repairs (during and after rent). I would use larger number like 7% for this. 

所有跟帖： 

• cap rate = net rent before mortgage payment/cost -happyfolk- ♂ (977 bytes) () 12/09/2011 postreply 20:26:28