Money In V’s Money Out
There is often debate about how cash flow positive property is defined. We define it like this. A property is cash flow positive if “Pre Tax” the money coming in from the property as income is greater than the money going out from the property as expenses.
The myth is that cash flow positive property is hard to find. In fact it is everywhere. Furthermore, cash flow positive property and capital growth are not mutually exclusive.
Positive gearing is simply when a property has income greater than expenses after tax. That is, once depreciation and other tax benefits have been included the property returns a plus for you on the income side of the equation rather than a minus.