The rule of thumb I've used to justify purchases is that I should be able to charge 1% of the price of the house per month for rent. For example, with this house if my total cost is $27,500 then I would need to charge at least $275 per month for rent. Since I already own three nearly identical townhouses in the same complex, I know I'll be able to charge at least $600 per rent.
Anyone looking for a 2 bedroom, 1.5 bath townhouse? The living room features wood floors and a fireplace. Anyone? :)