We sold our house in West Vancouver for $0.75 million in 1997 and rented a 3300 sq.ft. penthouse apartment for $2530/month. To stay ahead of our rent, we needed 5% APR or to account for income tax just under 7%. This is offset by the fact that utilities are included, including electric heat. During that period, we beat that investment target.
And we saved any maintenance expenses during that period. I would say that today it is marginal based on the current returns but it is a good way to hedge away real estate capital exposure. And, of course, the penthouse is considered even more luxurious than the house was. So we could have saved money on rent.