The 50% Rule: Video Tutorial

The 50% Rule: Video Tutorial

J ScottPro Member
Moderator
Investor · Sarasota, FL · Member since 2008 · 17k+ posts · 17k+ votes

I didn't want to post this earlier, as Jon Holdman was planning to present on this subject at the BP Summit 2012 and I didn't want to detract from his presentation. But, unfortunately, Jon had a family emergency and wasn't able to attend the Summit, so I thought I would put this up here.

This is a video I made a while back -- it wasn't intended a formal tutorial, in fact I was just testing out some educational video creation software and through this together to see how the software worked. It's far from professional, and not at all rehearsed, so keep your expectations low... :)

That said, with all the discussions of The 50% Rule around here whenever a new investor join us, I thought it might be worthwhile to have a video tutorial on the subject. If anyone finds this useful, perhaps I'll do something a bit more professional.

Anyway...enjoy!

http://www.123flip.com/wp-content/uploads/Test/50RuleFinal.html

Btw, to the mods, sorry for posting a link to another domain...I didn't know how best to embed the video. I made sure there are zero links on the page, so hopefully it isn't an issue. If you'd like me to embed this differently, let me know.

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Will BarnardPro Member
Moderator
Developer · Santa Clarita, CA · Member since 2008 · 15k+ posts · 10k+ votes
14y

Nicely done J, great job. This should be required reading/listening for all new combers to BP.

See this reply in the discussion

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  • Saint Albans, WV · Member since 2013 · 24 posts · 2 votes
    12y
    Originally posted by @Jon Klaus:
    I've heard of investors using 60% expenses as a rule if thumb on "bills paid" properties.

    Thanks Jon, I understand that 50% rule does not include utility bills, and they need to be accounted for separately.

    Does the same apply to 2% rule? The determined rent amount is the net rental income / gross income a month, and bills are payed by a tenant?

    @J Scott do you agree with that?

  • Ponchatoula, LA · Member since 2014 · 14 posts · 3 votes
    12y

    thanks @J Scott

    Is there a youtube link to your video?

  • J ScottPro Member
    Moderator
    OP
    Investor · Sarasota, FL · Member since 2008 · 17k+ posts · 17k+ votes
    12y
    Originally posted by @Jason Aycock:
    thanks @J Scott

    Is there a youtube link to your video?

    Nope, I never did put it up on YouTube...

    I'll add that to my to-do list!

  • Real Estate Professional · O Fallon, IL · Member since 2015 · 59 posts · 9 votes
    11y

    This brought a lot of things into perspective.  Very nice.

  • Real Estate Agent · Huntington Beach, CA · Member since 2014 · 12 posts · 3 votes
    10y

    Thank you J for posting.  This is a great video.  My expectations were very low due to your explanation.  ;-}

    Seriously this clearly explains the 50% rule and breaks down the costs involved in owning a rental property.  

  • Aurora, CO · Member since 2016 · 18 posts · 6 votes
    10y

    Ditto everyone else here, that video was a great link explaining the 50% rule.  It can easily be broken down in my mind now.

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