What this formula mean to you ygr×7+/-10%=Mao

5 Replies

yesterday I was listening to a webiner & the instructor arrive at a formula I haven't seen in my life. Don't get me wrong I finish college with a business degree, but that formula I never saw. The formula ygr×7+/-10%=Mao. Can someone please tell me when do I have to used this formula When I am looking at real estate? Also can you give an example for me please? 

My best guess is this is a formula someone worked out for their area. I'd guess "ygr" is "yearly gross rents" and a more correct written format would be MAO
The +/- makes little sense for a Maximum... but a general offer rule of thumb for that particular area may be in a range (e.g. +/- 10%). 

So if a property rents for $750, the range of offer to expect is between $56,700 and $69,300 and MAO is $69,300.

Just my speculation.

First of all I wanna thank you for your opinion on this difficult formula. I wasn't understanding it at all, so this formula only used if you are buying a rental property? & can you explain to me with you formula why you times (×) it by 1.1

Also is the formula you give me is that formula can used in new york state 

"times 1.1" = "plus 10%"

the +/- 10% is to compansate/addjust for quality and condition.  Great = +10%, average no percent, poor = -10%

hope that helps.

I still struggle with 7 being the right number.

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