Start with how you judge the deal
A well-crafted goal is clear enough for 3Y to solve against. Instead of asking whether a property is generally attractive, define what you need the deal to do.
If you care most about return on cash invested, use cash-on-cash return. If debt coverage and lending cushion matter most, use DSCR. If you think in monthly dollars per unit, use cash velocity.
Useful starting points
For cash-on-cash return, many investors use a target around 8–12% as a practical screening zone. A 10% target is a clean starting point. Riskier deals, weaker locations, heavier repairs, or more uncertain assumptions may require a higher target to make the risk worth taking.
Interest rates matter too. In a high-rate environment, debt service is higher, so the same property may support a lower achievable return unless the price is lower, rent is stronger, expenses are lower, or financing terms improve.
Cash velocity rule of thumb
For cash velocity, a simple rule of thumb is to target monthly net cash flow per unit around 10% of market rent.
For example, if market rent is about $1,800 per month, a cash velocity target of about $180 per unit per month is a reasonable starting point.
Keep the goal honest
A stronger goal usually requires a lower supported purchase price, stronger achievable rent, lower expenses, better financing, or some combination of those levers. If the 3Y Estimate is far below the asking price, that does not mean the goal is wrong. It means the asking price and your current assumptions may not converge with that goal.