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Correct as 6% is the long term average for 'property'. Have to...

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nippy

10,183 Posts.

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26/04/24

11:05

Post #: 73520745
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Originally posted by Cosmoterios: ↑

There is no such thing as a "Fixed" number of 6%.

Some properties need higher repairs and renovations - especially where you have tenants who have destroyed the property, before skipping. I have had situations where the tenant urinated and defecated on the carpet, destroyed the kitchen and bathroom before disappearing. And I have had to spend $30k to fix it.

Other times, its due to mother nature. I have had my property flooded. And even with insurance payment, it wasn't enough to buy the replacement value.

Then you have land tax, council rates, insurance and annual repairs.

And finally, the interest charges on the loan.

There are no fixed interest rate number. Every situation is different and every year is different.

To be a proper landlord, you have to earn income from other sources - on top of rental income, and you have to put money aside for these additional expenses (on top of interest charges).

Its only when you are in the game (property investment), that you realizes these facts versus fictions being projected about.

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Correct as 6% is the long term average for 'property'. Have to nominate a figure though and 6% it is. Deviations away from that are the concern when not justified in the short term.

In the main you have made a case AGAINST PROPERTY as an investment quite separately to the 6% figure.

6% assumes average property issues going forward.

Last edited by nippy: 26/04/24
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