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Updated over 16 years ago,

User Stats

203
Posts
1
Votes
Fred Shandler
  • Real Estate Investor
  • Jersey City, NJ
1
Votes |
203
Posts

How to adjust the 50% rule to reflect higher property taxes?

Fred Shandler
  • Real Estate Investor
  • Jersey City, NJ
Posted

I'm not sure I understand how to do this and I think it's an important idea for us rooks to understand, as property taxes differ significantly from place to place (especially where I am).

The area I've been studying has high property taxes and I'm confused as to how I should adjust the additional property tax expense, using the 50% rule. Is it true that taxes typically run 10% of gross rents? Is so, I can calculate the additional property taxes and subtract that by 10% of the rents, but I'm not sure if that's even accurate. Is there another, perhaps more accurate way of adjusting the 50% rule to reflect higher property taxes?

Thanks!
Fred

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