Musketier
2017-09-15 08:58:50
- #1
Rental income is just regular income. You just have to offset corresponding expenses and risks against it. Interest and repayment seem to no longer exist, then there would still be maintenance, maintenance reserves, non-allocable costs, and the default risk, which must be priced in with X%. Depreciation is indeed an expense, but not a payout. If the rent were not taken into account, you wouldn't be able to finance an investment property.
P.S. Of course, appropriate reserves should also be available in case the rent fails for a few months. This is the same issue as with entrepreneurs.