think globally, invest locally

this is not an one number game. You'd better use a matrix to measure.

Besides profitability, you cannot ignore liquidity and solvency. They are equally important.

to calculate profitability, you have to take all parameters into considerating, which include, but not limited to:

Property appreciation rate (or depreciation rate which could be more reasonable if treated like a consumable commodity)

Inflation rate

Mortgage interest

Rent yearly grow rate

Alternative investment return rate

......

Based on the current economic situation, 6% is ok provided that both liquidity and solvency are good. Otherwise, it's a headache because you cannot squeeze profitability anymore

所有跟帖： 

• What is good liquidity defined? -CirrusCloud- ♀ (705 bytes) () 05/21/2010 postreply 13:23:46

• 回复：What is good liquidity defined? (图) -槑- ♀ (7775 bytes) () 05/21/2010 postreply 14:04:13

• buying an old house could be profitable, but risky -槑- ♀ (1347 bytes) () 05/21/2010 postreply 14:32:43

• Thanks a lot!!! I'll study your posts more later. -CirrusCloud- ♀ (0 bytes) () 05/21/2010 postreply 15:47:04

• 回复：think globally, invest locally -qiaoshe- ♀ (155 bytes) () 05/21/2010 postreply 18:29:30

• 如果是return on capital,6%还行。return on capital 不同于 return on invest -槑- ♀ (63 bytes) () 05/22/2010 postreply 05:01:29

• 回复：如果是return on capital,6%还行。return on capital 不同于 return on inv -qiaoshe- ♀ (403 bytes) () 05/22/2010 postreply 07:59:46

• 彼此彼此 -槑- ♀ (123 bytes) () 05/22/2010 postreply 10:27:51