the answer can vary a lot, depending on property style, location, condition, management concept etc.
For prime properties you should target a gross return of 15%, which will give you about 9% net after cost (taxes, insurance, vacancies, repairs, utilities etc.). For low end properties this number has to be significantly higher to make it worth the investments, due to uncollectable rents, higher vacancy and repair cost - so definitiely aim for a gross number over 20%, better 25%. Also, the bigger the investment in this distressed market, the better the deals. Let me know if you have any other questions. Nils
Oct 25, 2010