hello im wondering about the 50% rule i have a property that im i

[Jacob Murphy]

hello im wondering about the 50% rule i have a property that im interested of purchasing it cashflows about 200$ a month but the 50% rule shows -203$ what does that mean and is it worth pursuing thanks 

[Joe Splitrock]

The 50% rule is very general and you could see expenses at 40% or 60% pretty easily. It also depends on the type of property. Multifamily is usually higher expenses because of owner paid utilities like water or garbage, even gas in some cases. When you say it cash flows $200 a month is that just Rent-Mortgage cash flow or are you including other expenses? I would recommend using a deal calculator like the one found on this website under TOOLS on the menu. That will give you detailed analysis. The 50% rule is just meant to be a quick estimate for high level filtering, not deep analysis.