If this is your first visit, be sure to
check out the FAQ by clicking the
link above. You may have to register
before you can post: click the register link above to proceed. To start viewing messages,
select the forum that you want to visit from the selection below.
Cap rates will vary depending on how attractive your property is to large buyers. If you have a large class A property in a major market, the cap rate would be lower than a basic site in a small market.
So without knowing more about the property it would be hard to say if it's good or bad. About a year ago mine (small market site, new construction) was appraised with an 8% cap rate. So to me your rate sounds good. But I have no idea if its an apples to apples comparison, and rates have been low lately due to the amount of money chasing these properties.
A have seen two different appraisers more than $50k apart on a property. Numbers can vary very widely from one to another, especially if one of them does not have experience in the industry.
Appraiser's accuracy makes Weathermen look perfect. It's a guess and there is no accountability in the system. But it's required so everyone uses them. Unfortunately, your livelihood and financial future can depend on their guessing. Good luck.
I am seeing 8-9% in actual purchases in upper Midwest.