Sally and Dave are considering buying an investment apartment.

The condo costs $400,000, and theyre planning to buy it in cash

They can rent out the condo for $24,000 per year ($2K per month)

There are additional miscellaneous expenses of $2,400 per year (condo fees of $200 per month).

Property taxes are $1,500 annually.

Currently, Sally and Dave have a tax rate of 30%.

Assume the full cost of the condo depreciates over 30 years.

Sally and Dave assume that at the end of the 10 years theyll be able to sell the condo for $680,000.

3. Consider a loan for 30 years. Owners repay the remaining part of the loan to the bank after 10 years (after selling the property)

What is the IRR?