Ive noticed people commonly throw around percentages regarding 'return on investment' for investment properties...
I currently have an investment property thats been tennanted for a few years now... how do i work out my 'return on investment %' for it?
From: Dan
Location: Mitcham
1 comment:
Hi Dan
The gross return is the annual rent achieved divided into the capital value of the property expressed as a percentage. Commonly this is calculated against purchase price BUT it should include all costs associated with the purchase including stamp duty and transfer costs.
So a $500,000 property rented for $300 per week gives a gross return of $15600 or 3.12% gross return. The net return is dependant on financing, tax and outgoings such as management costs, maintenance and rates and taxes.
I hope that helps.
Regards
Anthony
PS we will cover this on Toop.TV for you Wednesday, 1pm.
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