4 % of gross rental income may work for 1 - 3 unit properties but it equals about 5 months» rent on one unit of an 11 - plex (11 x $ 850 / mth (average) x 12 months + $ 112,000 x 4 % = $ 4,400 annual premium divided by $ 850 /
mth avg rent (= 5 months).