I'd disagree with that. IMO, LOE & +ve c/f work together v. well together as a balance between having a steady & reliable income & also having the benefits of earlier retirement & tax efficiency that LOE provides.LOE and Positive cash flow are usually mutually exclusive. People go the LOE route when their portfolio is more set-up as a growth over cash flow portfolio. If it was a high yield, low growth portfolio then you'd just spend the surplus cash flow.
Not sure if these spreadsheets take volatility into account. Volatility of house price growth is the most important aspect of LOE - most spreadsheets assume a steady 7%pa growth which will give a nice warm fuzzy feeling, but is likely to fail in reality. See The Plan thread & particularly the spreadsheet attached to post #6.Anyway, I posted up some spreadsheet examples
Unless you're going to use a fairly advanced strategy such as cashbonds, I wouldn't even get into this topic again.
The original post was in 2009. The lending environment back then was substantially different to what it is now and there were ways which you could borrow money and apply it to 'living off equity'. Those methods of borrowing money are now completely shut down.
The bottom line is you can't refinance once the money runs out, unless you have a source of income
How do people other then to sell the property, manage to control/judge the balance between....
eg If I have $10M portfolio with $7.5M debt with neutral c/f, that is expected to increase by $100K within 5 yrs.
I could draw down $500K today to give 80% LVR and live off the $100K tax free pa (inc paying interest on it) until the rent increased by $100K in 5 yrs time.
1st Rule of LOE is don't talk about LOE