Originally posted by Rosco
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In your example for #2 (i.e. $5k positive cashflow after costs and interest payments being possible with 6.07% yield, if I work backwards are you saying all expenses = 35% of rents?). For the last tax year I've averaged about 42% on expenses and I'd need 9.88% gross yield to be $5k positive on an interest only loan (@3.3% interest rate). Although my houses are mostly on the lower value side and I had 13.2% of income go towards R+M. I'd be interested to hear how low this component is for those who buy newer builds.
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