Rule of the thumb is a rough guess, gut feeling kind of guess. For quick guess without detail analysis, you want to build lots of cushion into the decision. The 1% will "most likely make money" because it has lots of cushion built in.

You can do more detail analysis with CAP/IRR/interest rate for more marginal deals.

7% annual GRM has too little margin IMO. Assuming operating cost (expenses+taxes) is 40% of gross, that gives you about 4.2% CAP rate. You are making a tiny profit after paying a 4% mortgage. Any down turn at rent, increase at expenses, or vacancy would bleed it into red.