Hey Accountants,
I was just curious as to what formula you would use to calculate the required capital growth to offset a negative cashflow investment to break even.
So the annual loss which would take into account all income received (rent & depreciation) minus all expenses.
For example if you were holding a very poor yielding property in a top location but wee relying on growth to offset the negative cashflow then what formula would you use to calculate how much annual growth would be required?
Now obviously you would invest to make a profit but this is just to understand how to breakeven on the loss.
I hope that makes sense?
I was just curious as to what formula you would use to calculate the required capital growth to offset a negative cashflow investment to break even.
So the annual loss which would take into account all income received (rent & depreciation) minus all expenses.
For example if you were holding a very poor yielding property in a top location but wee relying on growth to offset the negative cashflow then what formula would you use to calculate how much annual growth would be required?
Now obviously you would invest to make a profit but this is just to understand how to breakeven on the loss.
I hope that makes sense?