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Premed PrepWednesday, November 21, 2012. How Does Leverage and Debt Impact Returns on Residential Real Estate? As a speculative investment, residential real estate has the potential to make or lose vast sums of money due to the impact of financial leverage (debt). Houses are typically leveraged at 80% of their value. During the Great Housing Bubble, this leverage was often provided at 100% by various lenders. Combine these facts with the near elimination of loan underwriting standards allowing anyone to participate...
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