The most conservative rental housing investment is a single family home in a stable suburban neighborhood. It also usually has the highest appreciation rate over the long term. Unfortunately, it will produce the lowest cash on cash return in early years. We use a 3 bedroom single family rental for our example here because it greatly simplifies the numbers we have to consider. Other analyses at this site deal with multi-family and rental housing complexes.
The above topic is discussed in detail on our members' Financial Analysis page.