50% rule question...

[Rich Cavanagh]

Ok so I know not to live too strictly by the 50% rule and it is used in order to give a rough/quick analysis of properties.

That being said... I've seen some explanations of the 50% rule that doesn't quite make sense to me. The idea is to get a quick estimate of profitability but why is are taxes/ins left out of the calculation? Maybe I am missing something.

The way I've seen it calculated is 50% of the rent goes to maintenance and the rest goes to the mortgage(minus taxes/ins).

Taxes an insurance could be pretty substantial when doing the numbers. Why is it left out? It is still a cost that is eating away at your profit and in some cases into the other 50%.

[Scott W.]

with the way the government is going bankrupt, rest assured, the property taxes will be going up % wise in the future.

I can't do 10% for taxes/insurance in my state. too many crooked politicians & villages not living within their means.