I agree that the 1% rule isn't foolproof (it may even be fool-friendly) and to Marcus' point looking at Capex and YoY rent increase and other factors is probably more important (not to mention the type of neighborhood, like, there could be a great "on paper" deal but if you look at the area and people are stealing AC units it might not be so good on your $paper$). 

While not foolproof, it will help some.  

I can't afford to have deadbeat tenants, although it's not foolproof, I can't invest in an area that doesn't have laws to protect a landlord. 

As part of my due diligence, I always ask for proof that the prospective tenant has paid the last month's rent.I personally don't care how much praise the current landlord gives me about the prospective tenants, that could be a smoke screen to get rid of the trouble makers as fast as he can.While it's not 100% fool proof, if I don't see a cashed check or other proof that the tenant has paid his current rent, I'm going to put this tenant through the grinder to get every single detail I can.I consider this kind of check to be more important than an Eviction check.

It's not totally foolproof, but he feels it has helped weed out some bad renters.

There's no foolproof way to tell, but if you've got a long enough lens and the area is doing well financially, you should be fine.The key to this gentrification was the development of San Francisco--as all those tech jobs moved to SF, housing prices really started going crazy and pushing the artists out.

but that conclusion isn't foolproof, because we do have some very affluent areas that are down 11%, and there are also some very low SES areas that are up 5-10%....so, I don't know...

It's not foolproof, but it certainly helps if another investor in your market has already vetted them.  

So it's not foolproof or set-it-and-forget-it. 

But, number cruncher's will always try to compare things attempting to develop the fool proof method, some even write books about it.