Purchasing Rental Properties

[Bobby R.]

I'm not sure is this is the forum for this question, but here goes:

I've heard folks on BP talk about the 2% rule.  My first rental, where I rented my house after  I got married and moved in with my wife, I cleared almost $300/mo and that was nowhere near the 2% rule.  

With my bandit signs, I'm getting calls for where folk want to sell their rental property.  Some of them are where I can get a couple hundred dollars a month.  Another we can buy cheap and bank the full rent roll.

(I know you have to account for repairs, vacancies, yada yada, so don't get your drawls twisted)

How do determine if a rental is a good deal or not?

[Brie Schmidt]

@Bobby R. The 2% rule is just a guideline.  I consider my rental properties a success and have yet to hit the 2% rule.  Every market is different and it is really what you determine to be a good investment.  

People here also use the 50% rule which I think is a better guideline.  So if it rents for $1000 a month assume 50% will go to expenses.  That leaves you with $500 if your mortgage is $350 then you would cash flow $150.  People generally looking for $100 per door cash flow.