How to price duplex with 1% rule -- do I use current rent?

[Ken Swearengen]

I found a duplex I like, it would be my first investment property. Rent for unit #1 is 1100 and unit #2 is 850. Asking price for duplex is $225k. Now using the 1% rule, I should be asking $195k. However the rents are significantly under market. I could probably raise them to 1300 and 1000 no problem (that's still lower 25th percentile for area rents), which would make the asking price of 225 a great deal.

My question: Does the 1% rule work on existing rent or expected rent? If I have to be the one to raise the rents and possibly lose the tenants, I feel like I should be compensated for that with a lower price. Or are my expectations out of line with what actually happens in multifamily REI?