question about the 65 percent rule - Posted by andrew

Posted by Jya-Ning on October 23, 2003 at 13:42:02:

I saw a lower number (55%). That number excludes vacancy, tax insurance, cost to find next tenant, cost for maintain.

So if you have a 25 unit, each rent 800, you will have 800 * 25 * 12 as your max potential income. Times .65 (your number) it is the most likely income you will received. Then you can compare that with your financial cost to see if it support.

If you are not very handy, you may want to use .55 instead of .65

Jya-Ning

question about the 65 percent rule - Posted by andrew

Posted by andrew on October 23, 2003 at 24:38:55:

i remember reading about when figuring out what your expenses are going to be with multi-units you should take the number and multiply it by .65 to see if it supports financing. But do you do you that with the total gross income? Or do you have to subtract for vacancy, taxes, insurance and all that first AND THEN multiply by .65?