The 1% Rule

The 1% Rule

It is said that it takes looking at 1,000 potential properties to find one deal. One of the first ways I begin to eliminate potential property investments is through using the 1% rule. Utilizing this rule only takes a quick moment and will help figure out if a potential property is worth deeper investigation.

The 1% rule simply states, in order to have the possibility of a positive cash flow the monthly rent should be greater than 1% of the total cost of purchase and repairs.

For example, a property that cost $100,000.00 to purchase and renovate should have a minimum monthly rent of $1,000.00. The 1% rule is a guideline to help determine if the property is worth a complete analysis.

Schedule a 15-minute consultation with us to learn more about how you can utilize the 1% rule to help you find your first or next real estate investment.


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