1% Gross Rent
Good Afternoon, Fredericton! Welcome to Ben Schmidt.tv.
This is a little tip for you, investors out there that are looking to get into a rental unit, purchase a rental unit. A little rule that I kinda live by that I encountered and seems to make sense, is whatever the purchase price of the house is, you age gonna need 1 percent at least 1 percent of the purchase price to be your gross monthly rent on a monthly basis. So, if you're buying a 3-unit 300, 000 building, you need 3,000 a month to be able to service all the expenses of that property. The mortgage, the taxes, the heat the power.. That is kinda the number you need at least, to make the numbers work and I'll crib note as well with the fact that its also including a cheap management. That is probably gonna be, You purchasing the unit and you managing it. Roughly, it's gonna charge you 8-10 percent gross monthly rent in terms of cost for managing the property. So 1 percent of the purchase price, to be able to make your numbers work and that is with cheap management. If you have any questions about that, make sure you give me an email, ben.schmidt@me.com.