In case the number they receive is one or greater than one, then the investor could be certain that the property will be a very good deal, and vice versa goes wrong.

The 50% Rule
This principle says that 50% of the whole lease income that an investor gets from their property should be directed towards its own operating costs. But, rental homeowners needs to understand that mortgage is not a portion of the expenses that are operating. Such expenses consist of repairs, insurance, and property taxes.

The 70% Rule
This principle leans more on the buy and other of the real estate market. It says that the overall amount a investor pays for a property should be 70 percent of their projected after repair value, minus the repair costs. This suggests that the remaining 30% addresses all operating costs, including taxes, utilitiesand property holding expenses, as well as the commissions paid out into the real estate agent. jvavmcq7ur.