Small Multifamily and the 1% Rule

[Steven Gould]

I joined a webcast last night hosted by Brandon Turner. Awesome information and definitely gave me a good grounding into what I should be looking for when it comes to small multifamily properties. He says he looks for 2 main factors when analyzing a deal:

1) cash flow of $200 per unit per month

2) cash-on-cash return of 12%

He didn't mention anything about the 1% rule, and that surprised me a bit. Any thoughts on that from others who are currently investing in the space?