Does the 2% rule work in high priced markets such as Massachusetts?

[Will Crocker]

Hey guys,

I'm looking for a response from people in high priced markets like the North East and California. My question is, does the 2% rule of thumb, ie rent should be 2% of the purchase price, work for high priced markets like Massachusetts (where I live)? I get responses from sellers looking to sell their SFH and Multi families they have been using as rentals. I try to analyze the purchase price for these properties using that rule and I come up WAY short of what anyone would sell a rentable property for.

If this rule doesn't work here, what are people using instead?