All these talks are valid for "high rental" properties only. COCR vs yield rate....well, both got their uses. Just which are we more familiar with. I personally use only yield rates.

Up till a year ago, any net yield of >8%/year is good enough. Coz the interest rate is average 6.5%/annum. So sure got positive cashflow! How much exactly is the 1.5% depends on your initial cost lah.

Then for about a year or more, the interest rates have dropped drastically! Average now 4%/annum. So if you still have rentals giving >8%/annum returns, then ur laughing loudest. But with this downturn also, I see the rental yields(especially for higher end places) tended to fall 1-2%. Also, for new properties, the property prices have risen, so much so that for current investors, a yield of >6.5% is considered good now. But thats fines, coz its offsetted by the lower cost of borrowing.

This post has been edited by Minolta: Nov 14 2009, 10:14 AM