2% rule..is it still real?

[Rich Ramirez]

I'm in Southern CA and realize, based on the Podcasts, that the 2% rule can still be found in the Midwest or perhaps FL. Since the market has picked back up, I'm wondering if it still exists...generally? Or have other investors fought for such properties tooth and nail that the prices have gone up in such metros..effectively driving the 2% rule to more like a 1-1.5% gross monthly return. If it indeed exists, does one always have to uncover a distressed situation to acquire such a property? Or are we talking a standard MLS discovery? Inquiring minds want to know. I would also love to network with agents that can assist my wife and I with such investment property.

BTW, units and SFRs out here are around 0.5-.07% gross monthly return. Maybe even less. It's just ridiculous!

-Rich

[Brie Schmidt]

@Troy Whitney and @Account Closed - Keep the conversation on topic please, you are more than welcome to start your own thread.

I have 1% properties and 2% properties - They are in two vastly different markets and need to be looked at totally differently.  My 1% properties might not produce as much income, but my expenses are low and they probably take 10 hours per unit per year to manage.  My 2% properties have much higher expenses and take about 5 hours per month to manage each unit.  

You are going to be disappointed if you think just because a property hits the 2% rule it is going to be profitable.... you still need to run your numbers