Investment
Leverage (financial gearing)
Effect of debt on returns.
Leverage is the use of debt to increase the return on equity. Where the property's return exceeds the financing interest rate, a higher loan-to-value increases the return on equity, but also the risk.
See also
Sell an investment propertyFrequently asked questions about Leverage (financial gearing)
What does Leverage (financial gearing) mean?
Effect of debt on returns.
How does Leverage (financial gearing) work in commercial real estate?
Leverage is the use of debt to increase the return on equity. Where the property's return exceeds the financing interest rate, a higher loan-to-value increases the return on equity, but also the risk.
Related terms in investment
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