I know of one multi unit complex in Sacramento that will cash flow at a 10% cap rate.
There is one in Fresno that is at a 9% cap rate.
Finding multi family properties with Cap Rates in northern california that are in excess of 8% is very rare.
I tink the average cap rate for 8 to 16 units is about 6.5% The average cap rate for fourplexes is about 5.5% -- -- You can earn 5% risk free on a Certificate of deposit at a bank.
Justifications to invest in multi family real estate in Northern California must then be: 1. expectation of future appreciation 2. Personal talent in managing properties and addding value through YOUR expertise. 3. Possible future tax benefits. 4. The personal satisfaction of knowing that your money and hard work is helping to provide shelter for grateful tenants.