Rent Vs Buy: Muizenberg - Potential For Low Yields

We're on a bit of a Muizenberg kick today. Here's a 1 bed apartment for sale for R900 000 with a 'rental income potential' of R3 500 a month. The difference between the rent and the bond payment is over two times the rent itself if you took out a full bond. Here's the income yield and payment graph:

So if you buy the place in cash you can expect a 4.67% return on income, about 5% below inflation. With a 50% downpayment the property still has to appreciate 3% to prevent you from losing money and breaking even on cash flow is only possible with a 70% downpayment. Yields would be even less if you took into account rates, levies, maintenance and vacancy costs.