As a rough rule of thumb, the higher the CAP rate, the better the investment opportunity. This calculation provides a true indication of the investors return in a one year time period. Today, financing is readily available on duplexes, triplexes, and fourplexes as they qualify for single family residential loans. Although financing is available for the 5 to 99 unit range, the term, recourse, and interest rates are not as competitive as the other product types. As a rule of thumb, the larger a property, the greater the economies of scale for management.
Most smaller communities require the owner to be hands on to manage.
The development of a management plan will ensure the success of any property. Professional management is always desired, but sometimes the size of the property does not financially support a third party management company. Every situation is unique, and as such, we recommend that you contact us for an analysis of your management needs. If you subscribe to our newsletter, you are aware of the trends in the marketplace, and the potential to increase rents. If you do not have access to market info, you can create your own by calling competing properties.