50% Rule Calculator for Rental Properties

What the 50% rule means

The 50% rule is an investor rule of thumb: operating expenses, excluding the mortgage, average about half of rent. This estimate uses rent × 50% for expenses, then subtracts those expenses and your mortgage principal and interest from rent.

Actual expenses vary a lot with property age, taxes, insurance and location. Capital expenses like roofs and HVAC are lumpy, not evenly spread monthly. This rule is not a property-specific budget or advice; do not automatically add a reserve to the 50% allowance without checking what it includes.