I hear you on the 1% rule—honestly, it’s never felt like quite enough for me either. I’ve tried to keep at least a couple months’ worth of mortgage payments set aside, just in case something big breaks and the usual “maintenance fund” doesn’t cut it. There’s always that one year where everything seems to go wrong at once... Last winter, my furnace and water heater both died within weeks. No spreadsheet could’ve predicted that mess. Your monthly audit idea sounds smart though—might have to steal that one.
That 1% rule feels more like wishful thinking these days, especially with how prices have jumped on repairs. I’ve seen folks get caught out with back-to-back issues just like your furnace and water heater saga—brutal. I usually tell clients to budget for at least 2-3% if they can swing it, or keep a rainy day fund big enough for a major hit. Monthly audits help catch stuff before it snowballs, but sometimes you just get clobbered no matter how careful you are... That’s the landlord life, right?
Yeah, the 1% rule feels outdated now. I’ve seen properties eat through that reserve in a single month—especially if you get unlucky with timing. I always push for 3% minimum, even if it stings up front. If you’re juggling DSCR loans, keeping your credit profile tight helps too. Lenders get nervous fast if you miss a payment because of surprise repairs. I’ve had to shuffle lines of credit before just to cover back-to-back hits... not fun, but it kept things afloat.
Man, the 1% rule really does feel like a relic sometimes. I used to think I was being all responsible, socking away that much, and then—bam—one water heater and a roof leak later, it’s like, “Guess I’ll just eat ramen for a month.” Pushing for 3% hurts at first, but it’s way less painful than scrambling to cover a surprise $4k repair.
On the DSCR loans and credit front, you nailed it. Lenders act like you’ve set their hair on fire if you’re even a day late. I’ve had to play musical chairs with my credit cards more than once. My trick is to set up auto-pay for the minimums, just in case I’m distracted by a tenant’s midnight plumbing emergency. Not glamorous, but it’s saved my bacon.
Honestly, juggling all this stuff feels like spinning plates while someone keeps handing you more plates... and occasionally, one’s on fire. But hey, you’re still standing, so you must be doing something right.
That 1% “rule” really does seem like wishful thinking these days. I remember when I first started out, everyone swore by it—just tuck away 1% and you’ll be golden. Then reality hits with a double-whammy like a busted furnace and a sewer backup in the same month, and suddenly you’re raiding your emergency fund and questioning all your life choices. Bumping up to 3% felt rough at first, but honestly, I’d rather deal with the pain upfront than scramble later. Have you ever tracked how much you actually spend on repairs over a few years? I did that for my oldest property and was shocked—it averaged closer to 4% some years once you factor in the random big stuff.
The DSCR loan stress is real. Lenders have zero chill if there’s even a hint of lateness. I’ve had to negotiate late payment fees once or twice when rent checks got delayed—never fun. Setting up auto-pay for minimums is smart, though. I do something similar but try to pay in full when I can... although, let’s be honest, sometimes it’s just about keeping the lights on until next month.
Ever get that feeling where you’re just waiting for the next thing to break? Sometimes it feels like properties have a sixth sense for when your cash reserves are low. One year my water heater died literally two weeks after the fridge went out in another unit. That was a fun month.
Curious—do you self-manage everything or have you brought in a property manager? I’ve gone back and forth on it, but every time I think about handing off the headaches, I look at the fees and end up convincing myself to keep juggling those flaming plates myself.
