Does it make financial sense 1 to borrow money when the borrowing itself comes at a cost? If it is anticipated that a property's price, say, will increase at a rate much higher than a mortgage rate, then it might well make sense to borrow now to purchase the property, despite the incurred borrowing cost. This is known as gearing. Herein, I analyse exactly when to apply gearing.

---

1. 1 I declare this to be my own work, entirely. In particular, no AI was used in any research, analysis, synthesis, writing, nor typesetting of this work. In short, AI was not recruited at any time in this work. Errors and inaccuracies are therefore proudly my own.

Download PDF geared-borrowing.pdf (172 KB)