Price to rent ratio

[Frank Apap]

Total newbie here, considering buying a property to rent (two family home) and hold for 5-10 years before selling.

I'd like to have a break even or positive cash flow and was wondering if there was a rule of thumb of what ratio of home cost (sale price) / (annual rent) would be a good place to start?

Thanks

[Jon Holdman]

I've made a couple of threads in the Landlording forum on this topic sticky. Have a look at those for more than you ever wanted to know about expenses.

Really, expenses are the only tricky piece of evaluating a rental. Everything else is just simple math.