OK, my last attempt to illustrate my point.

House Rented for $140 /week = 7280/yr
Mortgage = 125/week = 6500/yr
Interest component = 100/wk = 5200 / yr
Therefore positive cashflow = 780/yr (7280-6500)

Considering tax ….
Tax liability = 48.5% x 7280 = $3530.8
Refund on interest component of mortgage =
$2522 (48.5% of $5200)
Therefore net tax liability of 1008.80 ($2522 – $3530.
Your prveviously $780 cash flow is now $228 in the red. ($1008 tax liability + 780 from rent after mortgage payments)

Now granted the figures may not be totally accurate given current interest rates etc, but it illustrates the point I was trying to make…
That is, if you dont consider the tax in your equations, your positive cash flow may not be all it seems. This doesn’t seem to be mentioned in the book.

Cheers and thanx for the feedback.

Considering the tax puts you

I take your point. But what I’m suggesting is that without considering the tax, what you may percieve as posite cash flow may actually not be when the tax is considered.??