The 50% rule
A rule of thumb that a rental’s operating expenses run about half of its gross income, leaving roughly 50% as NOI.
In plain terms
The 50% rule is a quick screen: estimated NOI ≈ 50% × gross income. Real expense ratios range from about 35% to over 60%. Pair it with the 1% rule to triage a listing before detailed underwriting. Try the 50% rule calculator.