I agree with what is below and will supplicate it with the fact that cap rates fluctuate within a building, even one as small as a du or triplex, even more so within a neighborhood let alone a city as a whole. Most duplexes and triplexes I have come across are between 4-12 percent. With higher rates being place with deflated sales prices. I would look at GRM (Gross Rent Multiplier) as a better way to hone in on your numbers, as these are easier to figure out, and not dependent on the word of the prior landlord. I would love to help you find a high producing rental property, let me know how I can help!
The Bartic Group
(303) 880-8778 - Cell
Excellent question. And a very difficult source of information indeed. As you probably know, the ellusive piece of data of the equation/calculation you are missing on such properties is the NOI. There is no central data source for this information.
The MLS does have a data field for NOI to be entered. So you can try searching Income Properties in the MLS and might be able to procure some market data there to calculate a Cap Rate. I have semi-successfully running such analysis in the past.
Curious, why do you want Cap Rates for such properties? In my opinion that would not be the best measurement/metric for properties like that. My business is investor based and I buy/sell a lot of <4 unit properties in Central Denver. The Cap Rate rarely makes any sense when comparing them. Plus, with a Cap Rate you are governed by the income & expense numbers some Joe Blow property owner is reporting or relying on the compentency of the listing broker advising them on Income Properties.
@Brian Burke - Definition: Capitalization rate (or "cap rate") is the ratio between the net operating income produced by an asset and its capital cost (the original price paid to buy the asset) or alternatively its current market value. The rate is calculated in a simple fashion as follows:
Capitalization Rate = annual net operating income/cost (or value)
You could also try. http://www.caprates.net/ I am not familiar with the site but from the looks of it, it should assist in your search.
If you need any help getting in touch with a couple appraisers that specialize in this area, I would be happy to try to connect you. Please let me know if I can assistance you further.