Let us apply the facts of the grocery example to a true case in real estate

Let us apply the facts of the grocery example to a true case in real estate. There are two apartment buildings not far from my office. They were built on a piece of land that is one-half in Brookline and one-half in Boston, Mass. The same builder built both at the same time. He built them precisely alike. As a result, they both earn the same income, approximately $40,000 per year each. Now the rule-of-thumb investor or speculator stops right there. He takes that income figure of $40,000 and multiplies it by six and two thirds. That is the same as multiplying 15% as income to bring it to 100% as value. And the speculator buys either building at that price, or for as much less as he can. You will not stop there.
Both buildings being exactly the same, they are assessed for tax purposes for $120,000 each, by their respective cities. But the tax rate per $1000 of assessed value in Brookline happens to be $55. That of Boston well over $100. Please fix these facts firmly in your mind and remember that the annual tax bill for the Brookline building is some $6600. That leaves $33,400 of the income after taxes. The Boston building must pay $13,000 each year as its tax bill, leaving $27,000 of the income for other purposes. Now I ask you the big question. Would you pay the same amount for either building? Of course not! Yet, the speculators do! Because their way of figuring does not take these things into account. Yours does.