terry ryder in the australian, page-16

Pwinne,
Just looking at some figures of your recent purchase at ballarat.

$240 purchase...costs say $10k total $250K


Loan at 7% interest only $14000
Council rates est $ 1000
Ins/water etc $ 1000
Loss of Income on $50k dep $ 3000

Total cost (minimum to buy) $19000

Income $300 PW x 52 $15600 less 7% agent Approx $14500 nett...

So its costing you $4500 per year to have your name on the title.

So u are assuming a capital gain of $4500 per year to stay even.....not taking into account inflation etc....

How can this be derived as an investment?

I am not trying to say property is not a good investment, all investments go in cycles..IMO property is now entering a down cycle...so there is no data to suggest otherwise..so i would not be investing in property now....as IMO you can will be able to purchase cheaper down the track...even if the prices stagnate and dont fall for 3 years you are still $13500 in front...