Value Collector
Have courage, and be kind.
- Joined
- 13 January 2014
- Posts
- 12,132
- Reactions
- 8,386
Those costs would be funded by the rental return. So your return on return property isI seriously question the long term return quoted for residential property. No one seems to factor in properly the holding costs, maintenance costs and land tax. The only way to make big money is to take big risks in the form of leverage.
Captial gain + Net Rental income after costs
In my experience roughly 25% of the rent goes towards costs, leaving about 75% as net rent. Interest expense is a separate thing if you decide to use debt, in that case any interest eats into you 75% net rent, and if the loan is big eats it all and the property becomes “Negatively geared”
if you are living in the house yourself the rental return is the rent you saved, after your costs.