3000 Cash Rule: What It Is and How It Helps Real Estate Investors

When you're looking at rental properties, you don't need a finance degree to tell if it's worth buying. The 3000 cash rule, a simple guideline used by real estate investors to quickly estimate if a rental property generates enough income to cover costs and leave profit. Also known as the 3x rule, it says: if a property's monthly rent is at least $3,000, it's likely to cash flow well in most U.S. markets. It’s not a law, but it’s a fast filter that saves hours of number crunching.

This rule ties directly to cash flow, the money left over after paying all expenses on a rental property. If your rent is $3,000, you’re assuming expenses like taxes, insurance, maintenance, and vacancy will total around $1,500—leaving you $1,500 in profit. That’s the goal. It’s not about getting rich overnight, but about building steady income without constant stress. You’ll see this rule pop up in posts about investment property, real estate bought to generate rental income or capital gain because it works best for single-family homes and small multi-unit buildings in growing areas. It doesn’t apply to luxury condos in Manhattan or raw land in rural Texas, but for average markets from Texas to Ohio, it’s a solid starting point.

Many investors mix up the 3000 cash rule with the 2% rule—where rent should be 2% of the purchase price. But the 3000 rule skips the math and focuses on real-world numbers you can see today. A $300,000 house with $3,000 rent? That’s 1%. Too low. A $200,000 house with $3,000 rent? That’s 1.5%, but still strong because expenses are lower. The rule cuts through noise. It’s used by landlords who manage their own properties, by new investors testing the waters, and even by property managers who screen listings before showing them to clients. You’ll find it referenced in guides about rental property, a home leased to tenants for income because it’s practical, not theoretical. It doesn’t care about cap rates or ROI percentages. It just asks: does the rent feel right for the cost?

Below, you’ll find real posts from investors who’ve used this rule—some successfully, some after learning the hard way. You’ll see how it fits with property taxes, tenant screening, and local market trends. No fluff. Just what works when you’re standing in front of a house, wondering if it’s worth the risk.