Cash Flow Guys Podcast

When analyzing potential deals there are lots of different formulas you can use to see if a deal with worth pursuing. All of these formulas depend on accurate data to generate an accurate end result.   The 1% Rule - Defined as the expected monthly rent divided by the ARV or After Repaired Value of the home. This rule is what I nickname the "Bigger Pockets Rule" because if you use this you will often find more room in your empty pockets due to the money being removed from those pockets. The rule can be helpful as a loose guideline to measure a potential investment opportunity however much more diligence and details are required to make an informed decision.   Potential Problems:   Is the monthly rent figure actual or estimated? Estimates cause the end result to be inaccurate. Sellers, Realtors, and Wholesalers tend to estimate income and expenses more often than not, which means your end result will not be accurate and can only be viewed as a very loose estimate.   Valuation in ARV, who determined the ARV? A W