Hi Andre,
Great question! First and foremost the 10% rule is primarily a filter - when looking for property it is common to look at quite a few, many will have no chance, and this filter helps chuck the ones that simply won`t work as an investment. However, it is just a filter and does not go in depth into a particular property. I have seen properties work at 7-8% once you get into the real numbers, and you never really know about a particular property until you put in an offer at a price that works. So, use it as a filter, toss the "dogs" and crunch a little further if the % gets up there. But remember, just b/c a property meets the 10% rule, even if it comes in at 20%, make sure it fits your business - don`t chase percentages and be careful depending on city, town, neighbourhood and even building as all can impact your results. Something that looks like a cash cow may be vacant 50% of the time with huge maintenance issues...who knows.
Another important point is that you must become a geographic specialist - ie. know your market, know the area, know the product you invest in, the tenant profile, etc. By becoming a geographic specialist you essentially become an expert in that area, you know your numbers, your tenants and you can act quickly when properties pop up.
Finally, not all places work for investment and some cities/towns will be difficult to find good properties - you don`t have to invest where you live (but it is easier sometimes!).
Hope this helps, tons of helpful info on this site.
