Four ways to make money on a property
Every property investment lives or dies on which wealth engine you're running. The right model depends on your capital, your timeline, and the property itself. Here's every model NordInvest supports — and which kind of deal each one was built for.
The foundational model — and the default for any rental property analysis. Rent comes in, mortgage and operating costs go out, what's left is your monthly income. Cashflow investors hold for the long term, refinance when rates drop, and treat each property as a yielding asset.
Monthly Cash Flow = Rent − Mortgage − Expenses
Annual ROI = (Annual Cash Flow ÷ Cash Invested) × 100
Gross Rental Yield = (Annual Rent ÷ Property Price) × 100
Methodology: standard residential rental analysis used in Brandon Turner, The Book on Rental Property Investing (BiggerPockets, 2015). How to calculate rental yield →
The capital-recycling strategy. Buy a distressed or under-priced property, rehabilitate it, rent it out, then refinance at the new (higher) appraised value to pull most of your original capital back out. If the math works, you end up holding a cash-flowing rental with little or none of your own money still in the deal — and you redeploy the recovered capital into the next acquisition.
Refinance Loan = ARV × LTV% (industry std: 75%)
Cash Recovered = Refinance Loan − Original Mortgage Balance
Effective Cash-in-Deal = Down + Rehab − Cash Recovered
Cash-on-Cash Return = (Annual Cash Flow ÷ Cash-in-Deal) × 100
Methodology: David Greene, Buy, Rehab, Rent, Refinance, Repeat (BiggerPockets Publishing, 2019). 75% ARV is the standard refi LTV.
In high-price, supply-constrained markets — central Copenhagen, Oslo, Stockholm, London Zone 1, Munich — gross yields compress to 3–4% and a leveraged property often runs slightly negative on cash flow. The investment case rests entirely on long-term appreciation: the property's value grows faster than your carry cost.
Projected Value (yr N) = Price × (1 + appreciation rate)^N
Equity Return = (Capital Gain ÷ Down Payment) × 100
Appreciation rates come from Statistics Denmark / SCB / SSB. We never extrapolate beyond what the published series support.
Distinct from BRRRR because you don't necessarily refinance — you create value through a specific lever: renovate to raise rent, convert a single-family into a duplex, change use, split a large unit, or buy a problem and solve it. Returns come from your work, not market wind.
Forced Value = New Rent × 12 ÷ Target Yield
Project Profit = Forced Value − (Purchase + Renovation + Carry)
Underpinning theory: commercial real-estate forced-appreciation playbook, adapted for residential. See Ken McElroy, The ABCs of Real Estate Investing.
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