What do I need to know about investment properties?
The demand for multi-family houses in good locations has been significantly greater than the supply for several years. As a result, prices are rising and, with stagnating rental income, returns are falling. Buyers therefore often have to contribute a large part of their assets as equity. This quickly becomes a cluster risk. If interest rates rise, the capitalised value of the investment property falls, and the bank may demand additional equity. It is also important to know the actual share of the gross yield that remains on the bottom line.