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05-06-2022, 05:43 PM
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Sage
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Join Date: Aug 2009
Location: NJ, NM, SC, PA, DC, MD, VA, NY, CA, ID and finally FL.
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Quote:
Originally Posted by RVJim
if you are getting 1% of value per month then you are getting a 12% annual capitalization rate. You are not likely to get that on an full 12 month lease. Nice try though I think 7-8% cap rate is likely more realistic. You might get 12% on a full seasonal depending on what you throw in.
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To be clear cap rate is the ratio of net operating income (NOI) to a property's value. It is not based on gross rental income to property value.
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