Just wondering - do all the seasoned property investors here consider positive cash flow as part of your investment consideration? (i.e positive cash after off-setting mortgage and maintenance from the tenancy)
Currently, we're seeing about 5%+ rental yield for MM in good locations, 3-4% for 99-yr regular condo in OCR and RCR, 1-3% for CCR and negative yields for some bigger landed + GCB based on today's asking prices. Prices have gone up so much these couple of years that yields have come down a lot.
I presume only the MMs and 99-yr leasehold will get positive cashflow based on today's interest rates.
Question is - interest rates will rise one day and erode into that positive cash flow. If that cash flow become negative, will you still hold on to the investment properties?
I'm asking because normally the ones with deeper pockets don't really care. But nowadays we have many lower-middle/middle class investors who are already vested. Cash flow is an important consideration for them.
So would most dispose of their properties when that happens and move on to other asset classes?