optimal rent per dollar invested


what kind of rental properties give you the best yield in rent per dollar invested in buying the property to rent out? does this come from cheap 1 bedroom condos or maybe from 100K family houses or maybe some other kind of property? does the price area make a difference in addition to the kind of property for what I’m asking about?


multi-unit properties in the worst neighborhoods have the best gross rent multiplers. Most people don’t like them becuase they are not “sexy” and a pain to deal with. There is a reason the word “slumlord” has the connotation of well-off owners of crappy property.

thanks for the reply.

does anyone have any examples of how much money they’ve paid for these types of properties and what they were getting in rent?


Hey aggie,

I have a friend that’s into rentals and his maximum offer is 80 times gross monthly rent minus any repairs/updates.

Example: 5 unit building @ $500/month rent = $2500/month gross rent * 80 = $200,000 - $37,000 in repairs = $163,000 maximum offer. You don’t necessarily want to offer that much, but that would be the maximum.

Basically, after vacancy loss, property taxes, insurance and maintenance, it leaves a ROI of 10-12% excluding appreciation

Hope this helps,

There are a lot of aspects and numbers to consider and they vary widely from property to property. It’s best to get all the figures and analyze the deal on a case by case basis. Punch in the numbers and make sure the cap rate, GRM, DCR, CashFlow and ROI all meet your expectations.

I was just wondering if there was a particular subset of rental investing that people found were most likely to give the highest yield per dollar invested. like, would it be lower-middle class simple family houses, 1-bedroom condos, vacation properties, section 8 housing, luxury urban sky-rise condos, low-income houses, middle to upper middle class houses, duplexes, multiplexes, large houses, etc.

so please, if anyone has experience and examples, please chime in!