Well Kingy....lets do a case study...
You buy this place..
http://www.onthehouse.com.au/reports/property_profile/6539002/9_Birrell_Street_NORWOOD_SA_5067/
use the lower end of the spectrum of value $640K
I will rent it..
http://www.realestate.com.au/property-house-sa-norwood-408371147
Soo I pay $24k a year....to live there...
You borrow ^650k including fees..
at 6% interest...very cheap...
Your interest bill is $39k a year...plus rates, insurance, = outgoings of total $42K a year...
so I am $18k a year I can bank...
Say you are on the 50% tax bracket...you are still losing $9k a year...why would i want to buy?
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