50% rule & ROI question

[Raymond Van den Ende]

Hello all,

I was thinking about the 50% rule and I was combining this to the ROI. When you evaluate a deal do you factor in your own investment (money wise like down payment) or not? Example, would this deals (not real numbers) require the same 100$ cashflow or would you adjust somewhere?

1. Rent: 6000 /year
NOI: 3000 / year (50% Expenses)
Cashflow: 1200 / year
Leaves: 1800 / year for mort
=> Max price ~ 22500 (30 year @ 7%)

2. Rent: 60000 /year
NOI: 30000 / year (50% Expenses)
Cashflow: 1200 / year
Leaves: 28800 / year for mort
=> Max price ~ 360700 (30 year @ 7%)

My feeling tells me to buy 15 number 1 properties to enjoy 1500 / cashflow :-) / relate this somehow to my investment. What about you??

Greetz,

Raymond