I'd check with a lawyer before implementing that policy.HUD defines affordable housing as the cost does not exceed 1/3 of your gross income.

A good rule of thumb to use would be to take 50% of the gross rents as expenses (all expenses except debt service).

I should get 8400/mth gross income.

Here are the details regarding the property that I would like an honest opinion and assessment from fellow enthusiast and fanatics.Type : 600 sq ft StudioAsking Price : $60,000HOA : $80/month or $960/yearTax : $150/month or $1,800/yearRent : $850Utilities(electric) : Tenant's responsibility(Gross - Expenses) = $850 - $80 HOA - $150 Tax - $85 10% Vacancy - $85 - Maintenance = $450 before mortgage.This condo is a small building and owner's managed.

The rule is just for evaluating properties because many people like to just take gross rent and subtract their mortgage, taxes and insurance and call that their cash flow and they forget about every other expense.

That is the gross amount per year.

I received their rent roll and it's currently grossing $39,850 monthly with 5 vacancies.

@Heajin KimThe rule is loosely that over a long period of time and across your portfolio your non financing expenses will run you around 50% of your gross rents.There is no inherent reason that a condo will not work any different than any other property for this.

My monthly statements from him show gross rent, certain expenses, certain reserves (e.g.

Hi, I'm looking to make a cautious entry into REI with this potential first SFR purchase.Cash purchase price $22k (no rehab needed at this time)Rent: $550 (current tenant is midway thru a 2 yr lease thru 6/2014)Gross income = 6600Expenses:Vacancy (1 mo) 550Taxes 297Insurance (estimate) 400PM (12%) 792Repairs ( ?)