So I know the "standard" way to calculate the 70% rule of thumb is to take the ARV x 0.70% and then subtract the rehab costs to come up with your MAO.My question is why wouldn't you take the ARV and subtract the rehab costs from that and then multiply by 0.70% to get your MAO?

One is "our best guess" in which we can remove some finish items and cost only items that are necessary for what the city needs to inspect; the ICC Building Valuation form is the second way (this is online, see link below) in which you multiply the building square footage by the valuation on the form based on type of construction (described in the IBC most houses are V-B); and lastly a estimate from a contractor, my preferred method for renovation projects.

I couldn't convince them despite the obvious situation that if you breathed, you got a mortgage.The funny thing about RE Motivational books is that they are really GREAT when times are going well.... but they are the worst to be convinced when the Economy is looking over the edge of a cliff, just before it is about to crash and burn.That's where the Real Education comes in.If you only do calculations that are geared towards the present, such as Cash on Cash Return (CoCR), Gross Rent Multiplier (GRM) or even Cap Rates but you don't do any Future Calculations such as Internal Rates of Return for a pro forma 10 year projection, you will not think about what is going to happen in the next 10 years.

I'm not ready to buy, but I am pretending that I am to gain some understanding on how to figure out what is a good deal and what is a bad deal.I came across several listings with Multiple unit buildings with a line in the description, "Gross Rent Multiplier".  

You multiply everything with SFRs.MFRE is easier to finance and refinance than SFR.It's easier to get limited liability protection on MFRE.  

Say it is 30%multiply the taxable income from the rental by you tax rate to get the next tax saving or tax expense from this calculation.  

Did they use a gross rent multiplier?

It's simply a product of whatever multipliers the local municipalities use to determine the taxes that they collect on the property.  

Risks can be mitigated and avoided to a large degree, but never fully eliminated ... so there is no investment vehicle in the world that will allow you to multiply your money 2-8x in 2-4 years with zero risk ... you should run away from anyone telling you otherwise. 4 things will keep you out of trouble and safe in a downturn, and you need all 4 (not just one):Equity: From a down payment and/or forced and/or market appreciationQuality Cash Flow: Not just any cash flow, but low maintenance, low volatility, stable, high quality cash flow that comes from high quality tenants who want to live in high quality property in high quality location.

Meaning can I take the assessed value of the home and multiply it (the assessed value) by .60% and make on offer?