1% Rule Calculator
Check a rental property’s monthly rent-to-price ratio, target rent and maximum price under the 1% screening rule.
Property breakdown
What the 1% rule actually tells you
The 1% rule compares one month of gross rent with the property’s price or acquisition basis. At a 1% target, a $300,000 property would need $3,000 of monthly rent. It is useful for fast screening because it requires almost no information.
It ignores vacancy, property taxes, insurance, repairs, management, financing and capital expenditures. A deal that passes can still have poor cash flow, and a deal that fails may still work under different market or financing assumptions.
Frequently asked questions
Is the 1% rule a return calculation?
No. It is only a rent-to-price screening ratio.
Should rehab costs be included?
Including upfront acquisition or rehab costs gives a more conservative screening basis.
What should I calculate next?
Run a full rental-property analysis, then examine NOI, cap rate and cash-on-cash return.
Rental-property calculations are estimates for screening and education, not investment, tax, lending or legal advice. Verify rents, expenses, financing and local conditions before making a decision.