property investing advice for a beginner, page-35

"This shows doubling around every 10 years and it has done so for the last 40 years. Is this really sustainable forever?"

NO,
and remember you are looking at REAL returns above inflation of 2-3%.

The return last 40 as you say = 7%pa, but we had some higher inflation periods which haven't been seen in last 20 with inflation targeting.

If you get 4-5% gross returns next 20, but inflation stays at ave 2.5%, then I think this is more like it over the next couple decades.
Just remember, over the life of mortgage, and being "average" with 20% down, you are still getting 16-20% pa gross roe on your money...as long as your investment is just cashflow neutral.

It may not be in first 5 years, but eventually it will, and some can accelerate that with minor renos or smart rent increasing improvements...or just buying the right location in first place.

The beauty of it is you fix 80% your debt at a point in time, and rental returns will at least match inflation...so by the time you are at year 15 of mortgage, your yield and ROE due to leverage will be higher than any blue chip I know, sustainable, and not subject to the volatility of global jitters.

Eventually, you have no debt. Do the math on that in 25 years.


Time does the work.

The bears will try to fudge all they can by quoting just "real" returns, yet will fail to adjust for improvements, rental increases, leverage of 5x and eventually a deceasing debt.