CalculateRealEstateROI

Multifamily

Should I focus on cap rate or cash-on-cash for multifamily?

Both — cap rate for asset comparison, CoC for return on your equity check.

Reviewed by Keiron Brown, Founder & Editor, CalculateRealEstateROI · Educational estimates only — not investment, financial, tax, or legal advice

Direct answer

Both — cap rate for asset comparison, CoC for return on your equity check.

Expanded explanation

Cap rate normalizes across leverage; CoC measures levered yield to investor. Both matter: a 5% cap deal with great financing can produce 12% CoC; a 7% cap with bad financing can flat-line.

Examples

  • 5.5% cap apartment with 75% LTV at 6.5% rate = 11% CoC.

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