Comments from an experienced property investor

[Musicwhiz]

Well if you look at investment point of view.

Property (4rm flat) $500K
20% downpayment (or COV) etc $100K (capital layout)
Rental it out for $2K PM ($24K PA)
Interest on $400K @2.6% = $1040

Yield= ($24K-$1040)/100K = 23%

No bad, if you ask me.

2.6% of $400,000 is $10,400, not $1,040. So the yield is just ($24K-$10.4K)/$100K = 13.6% not 23%.

This may look attractive at first glance, but you are assuming you can rent it out at $2,000 per month. The yield is also magnified due to leverage, as with any investment, leverage will make gains look rosier and losses look worse.