1 Percent Rule Calculator

✖Purchase Price is the amount of money paid to acquire an asset, property, or goods, typically agreed upon between the buyer and seller in a transaction.ⓘ Purchase Price [PP]

+10%

-10%

✖Minimum Monthly Rent refers to the lowest amount of money a tenant must pay each month to occupy a property under the terms of a lease agreement.ⓘ 1 Percent Rule [MMR]

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Formula

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1 Percent Rule

Formula

`"MMR" = 0.01*"PP"`

Example

`"1790"=0.01*"179000"`

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1 Percent Rule Solution

STEP 0: Pre-Calculation Summary

Formula Used

Minimum Monthly Rent = 0.01*Purchase Price
MMR = 0.01*PP
This formula uses 2 Variables

Variables Used

Minimum Monthly Rent - Minimum Monthly Rent refers to the lowest amount of money a tenant must pay each month to occupy a property under the terms of a lease agreement.
Purchase Price - Purchase Price is the amount of money paid to acquire an asset, property, or goods, typically agreed upon between the buyer and seller in a transaction.

STEP 1: Convert Input(s) to Base Unit

Purchase Price: 179000 --> No Conversion Required

STEP 2: Evaluate Formula

Substituting Input Values in Formula

MMR = 0.01*PP --> 0.01*179000

Evaluating ... ...

MMR = 1790

STEP 3: Convert Result to Output's Unit

1790 --> No Conversion Required

FINAL ANSWER

1790 <-- Minimum Monthly Rent

(Calculation completed in 00.004 seconds)

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Credits

Created by Keerthika Bathula

Indian Institute of Technology, Indian School of mines, Dhanbad (IIT ISM Dhanbad), Dhanbad

Keerthika Bathula has created this Calculator and 50+ more calculators!

Verified by Aashna

IGNOU (IGNOU), India

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1 Percent Rule Formula

Minimum Monthly Rent = 0.01*Purchase Price
MMR = 0.01*PP

What is 1 Percent Rule ?

The 1 percent rule in real estate investing is a guideline stating that a property's monthly rental income should ideally be at least 1 percent of its total purchase price. This rule helps investors quickly assess the income potential of a property relative to its cost, with properties meeting or exceeding this benchmark often considered more favorable for generating positive cash flow and a satisfactory return on investment. However, while the 1 percent rule provides a straightforward assessment, investors should also consider other factors such as property location, expenses, market conditions, and their investment objectives before making investment decisions.

How to Calculate 1 Percent Rule?

1 Percent Rule calculator uses Minimum Monthly Rent = 0.01*Purchase Price to calculate the Minimum Monthly Rent, The 1 Percent Rule is a guideline in real estate investing suggesting that a property's monthly rental income should be at least 1 percent of its total purchase price. Minimum Monthly Rent is denoted by MMR symbol.

How to calculate 1 Percent Rule using this online calculator? To use this online calculator for 1 Percent Rule, enter Purchase Price (PP) and hit the calculate button. Here is how the 1 Percent Rule calculation can be explained with given input values -> 1790 = 0.01*179000.

FAQ

What is 1 Percent Rule?

The 1 Percent Rule is a guideline in real estate investing suggesting that a property's monthly rental income should be at least 1 percent of its total purchase price and is represented as MMR = 0.01*PP or Minimum Monthly Rent = 0.01*Purchase Price. Purchase Price is the amount of money paid to acquire an asset, property, or goods, typically agreed upon between the buyer and seller in a transaction.

How to calculate 1 Percent Rule?

The 1 Percent Rule is a guideline in real estate investing suggesting that a property's monthly rental income should be at least 1 percent of its total purchase price is calculated using Minimum Monthly Rent = 0.01*Purchase Price. To calculate 1 Percent Rule, you need Purchase Price (PP). With our tool, you need to enter the respective value for Purchase Price and hit the calculate button. You can also select the units (if any) for Input(s) and the Output as well.

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