I know this is an older post. However, I thought I'd contribute knowing you'll be notified that an additional reply has been submitted.
I'll utilize three cap rates for your review:
1. A cap rate of 6% (areas of higher appreciation) a fair price (value) is $3,083,333.30
2. A cap rate of 8.5% a fair price is $2,178,470.60.
3. A cap rate of 12% (areas of low appreciation) a fair price is $1,541,666.70
The class c aspect doesn't impact the cap rate/value as much as the area of the country, type of property and other comparables. I think however as a guide for a class c property in an average area of the country with moderate appreciation I would look for a cap rate between 8.5-10%. The 10% cap rate fair price is obvious :) $1,850,000.
I hope this helps.
Dec 7, 2010