2019 Money Magnet Symposium - Discover how to make, and keep, more money and achieve a financially empowered future
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  • Profile photo of Property plusProperty plus
    Participant
    @lukecrawford
    Join Date: 2012
    Post Count: 13

    Hi there,

    As a general rule of thumb, what is an indicative rental yield that will cover all expenses including rates, interest and other costs that would then allow for a positive cash flow property?

    Your help is much appreciated.

    Cheers

    Profile photo of oc1oc1
    Participant
    @oc1
    Join Date: 2012
    Post Count: 148

    50% above your interest rate is a good start.

    Oscar

    Profile photo of jfk_ojfk_o
    Member
    @jfk_o
    Join Date: 2013
    Post Count: 11

    Here's an oldie, the price divided by 1000. When I was young I was told "Never pay more than 1000 times the rent they are getting".

    Get all over this:

    http://www.housing.nsw.gov.au/About+Us/Reports+Plans+and+Papers/Rent+and+Sales+Reports/

    Profile photo of Richard TaylorRichard Taylor
    Participant
    @qlds007
    Join Date: 2003
    Post Count: 12,010

    Going to depend on a number of factors including how much are you borrowing.

    Assume it is say 110% of the purchase price it is very unlikely in the current climate you will find a stand alone property that will return a yield that will cover all of your expenses.

    We say to our clients that we try and get as close as possible and then look to use alternative strategies such as Vendor Finance to balance the returns on properties they hold for the long term in their portfolio.

    Cheers

    Yours in Finance

    Richard Taylor | Mortgage Broker helping investors build their wealth thru property
    http://www.mortgagecapitalaustralia.com.au
    Email Me | Phone Me

    0-40 Properties in a decade with a unencumbered portfolio value in excess of $40M. Ask me for a copy of my API Interview.

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