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Yes, as nice as it sounds the reality is all depreciable items which form part of the non cash deductions would eventually be required to be replaced with money which will be worth a lot less due to inflation. As they say there is no free lunch. Cheers, Oracle.

No...I did not mean to insult you. I think we both were approaching the problem from a different angle. Appreciate your help. Please continue to do so...we are all here to learn from each other. Cheers, Oracle.

I used the word Net profit which is correct. Total would be cost + net profit. I believe my figures are correct. For $20,000 to become $52,504 (net profit of $32,504) you need to make 10.13% pa for 10 years. I did acknowledge this point in my post I hope you don't use this attitude...

Lets make a few assumptions - We buy IP for $100,000 instead of land - LVR 80% = Borrow $80,000 and put $20,000 deposit - Rent = Interest payments + other expenses (to keep things simple) After 10 years we still expect the property to only increase in value by inflation 3.5% so all the above...

I am sure many of you have heard or read about this before, but until recently I never understood the true meaning of what exactly does it mean by inflation being an invisible tax and why governments love it. Best to explain with an example. Suppose you decide to buy a piece of land for...