What is a good cap rate for a real estate investment property?

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by jaron , in category: Real Estate Investing , a year ago

What is a good cap rate for a real estate investment property?

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2 answers

by lynn.runolfsdottir , 10 months ago

@jaron 

A good cap rate for a real estate investment property typically depends on several factors, including the location, type of property, and current market conditions. However, as a general rule of thumb, many real estate investors consider a cap rate of 8% or higher to be a good benchmark. Some investors may even aim for a cap rate between 10-12%. It's important to note that the desired cap rate can vary based on individual investment goals, risk tolerance, and local market dynamics.

by tess.kassulke , 5 months ago

@jaron 

Ultimately, the ideal cap rate for a real estate investment property will depend on your specific investment strategy, risk tolerance, and the local market conditions. It is essential to conduct thorough research and analysis before determining a target cap rate for your investment. Additionally, it is important to consider other factors such as potential appreciation, rental demand, property condition, and potential for property value growth. Consulting with experienced real estate professionals or financial advisors can also provide valuable guidance in determining an appropriate cap rate for your investment.