As a Southern California investor, keep in mind that properties are expensive in most areas that are desirable - you aren't likely to find the opportunities for properties that meet those "1% rule" or "2% rule" that you'll hear investors in some other states talking about.My personal preference would be to find a nearby property to start learning the ropes with before you go for something more distant, and that would help you draw a circle around your home to allow you to start digging into neighborhoods and getting a feel for prices. 

I'd like your guys' opinions on if this is a good rule of thumb or not.

You and your husband and your siblings need to seriously look at how you are going to support your parents going forward. 

@John Warren 10 years of cash flow is a great rule of thumb!

You'd be lucky to find something with positive cash flow at all, much less hit the 1% rule.

A quick rule of thumb: with the Purchase price being $220K and rent being $1800/month, it doesn't even meet the 1% rule , if it were to be rented for 1% (220K x 0.01= $2200/month), it would most likely work out for you but this doesn't seem like the numbers work.Long story short, no deal- unless you can raise the rent and/or lower your PITI.

If you are purchasing Real Estate to cash flow you shouldn't buy based on the 1% rule.

Some set rules of 20%, or 30% or a specific dollar amount such as $30,000.

If the rental cap did not exist until now then you have every right to ask to be grandfatherd or being exempt from this cap until you sell your home.Talk to other landlords or like minded owners who can support you in voting this down.

Would appreciate numbers to support varying perspective.