We have blogged about the 1% rule earlier with the post here. The 2% rule is an extension to the 1% rule, and the intention of the 2% rule is to allow real estate investor to quickly determine if the deal is a potentially good cash flow deal or not. As always, we will first…
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The One Percent (1%) Rule
The 1% Rule is a handy formula for real estate investor to evaluate the potential profitability of any given deal, without pulling out a calculator or going through a complex financial model. Let’s take a look at the formula itself: Monthly Income / Purchase Price * 100 Here is an example: For an investment property…