question? about the 2% rule

[Wayne Freeman]

the 2% rule says that a 100,000 house... You need to get 2,000 in rent.

What if you get a 100,000 house and you spend 40,000 on rehap. Now do you do the 2% rule on the 140,000. Or you still do it on the purchase price of 100,000

[Dawn Anastasi]

Originally posted by @Wayne Freeman:

the 2% rule says that a 100,000 house... You need to get 2,000 in rent.

What if you get a 100,000 house and you spend 40,000 on rehap. Now do you do the 2% rule on the 140,000. Or you still do it on the purchase price of 100,000

The 2% rule means that if your place can rent for $2,000, you should be "all in" with purchase + rehab for no more than $100,000.

You cannot dictate market rent, the market does, so you look at rent first then look to purchase price + rehab costs. Not all areas of the country can you purchase at the 2% rule.