As I understand it, you are considering putting down 50% of the purchase price and then getting a mortgage for the other 50%, but are wondering if this will allow you to receive the rental income from those properties tax-free for the next 25 years. Based on these assumptions:
As others have hinted, with interest rates so low, you might be better off only putting 25% down on each property, leaving you with the saved monies to buy other properties, or have in reserve for maintenance, etc. As far as I know, there is no magic or major advantages gained by putting such a large percentage down.
As to the tax-free question: As others have mentioned, there is no tax law which says the rental income will be tax free. You will take in rent and the tax laws allow you to offset that rental income with certain expenses you incur (such as depreciation, repairs and maintenance, taxes, etc.--versus major improvements, which must be depreciated over time). If the expenses are greater than the rental income, one might think of this as "tax free" income, though I would suggest true tax-free income is more like untaxed portion of Social Security, or tax-free municipal bonds, etc.
Feel free to call me to help with any further questions and to help you get on the road to being a landlord.
Basically my friend is from China and she just wants to get some cash flow for her retirement life from rental properties in AZ. She has cash now, so she would like to pay cash and no any burden in future & just get cash for retirement life. 50% mortgage meant financing half of house payment and another half is paid by cash, then she could get up to 25 yrs tax free for rental incomes.
You have an interesting question which can apply to many who are getting into investment real estate for the first time. It is a good idea to consult with a CPA and attorney before purchasing real estate. They can assist you in running numbers and achieving your long term goals. I notice you did not say what your profession is or whether this is an investment for yourself or a group/partnership. That might make a difference in the answer you recieve from one of the above professionals, a mortgage lender, or a real estate professional. One other thing, because the market and real estate is changing so fast, getting up to date information is essential.
And as Don said, what does your paying "50% of mortgage mean"??
Price range and cap rate are also major factors in attempting to answer your question.
Bottom line --> consult with appropriate accounting and tax professionals.
But why would you then get rental income taxe free?
Note: It's usually a bad strategy to put that much down on investment properties. Check with an accountant.
And while I understand 40%-50% down, what do you then mean by "50% of mortgage"?
Bottom line: You need professional advice.