...remember that it is predicted by the banks that the value of houses will double over the next four years, this house in four years will be worth R2,160,000:00 not even interest in the banks can match that, and what will it cost you to gain that growth, call me and I will tell you. At present the property has a tenant at R4,500:00 pm rental income.
Wow! In four years it will double in price to over R2 million! So... uh... why are you selling? You're throwing away R250 000 a year in appreciation!
Maybe it's because you're earning R4 500 a month in rent. With a purchase price of R1 050 000 your potential buyer is barely making 5% ROI with R700 000 deposit just to break even at cashflow. And if the price doubles? I suspect the next buyer after that will have bit of a hard time suddenly doubling the rent...
| Down Payment | Monthly Payment | Cash flow | Annual Income | ROI |
|---|---|---|---|---|
| R0 | R12301.54 | R-7801.54 | R-93618.54 | |
| R105000 | R11071.39 | R-6571.39 | R-78856.69 | -75.10% |
| R210000 | R9841.24 | R-5341.24 | R-64094.83 | -30.52% |
| R315000 | R8611.08 | R-4111.08 | R-49332.98 | -15.66% |
| R420000 | R7380.93 | R-2880.93 | R-34571.12 | -8.23% |
| R525000 | R6150.77 | R-1650.77 | R-19809.27 | -3.77% |
| R630000 | R4920.62 | R-420.62 | R-5047.42 | -0.80% |
| R735000 | R3690.46 | R809.54 | R9714.44 | 1.32% |
| R840000 | R2460.31 | R2039.69 | R24476.29 | 2.91% |
| R945000 | R1230.15 | R3269.85 | R39238.15 | 4.15% |
| R1050000 | R0.00 | R4500.00 | R54000.00 | 5.14% |
1 comment:
From CJ
... or, maybe the banks might be telling us little fibs and our over priced property may just drop by 25 % over the next 4 years ... so buy the house now on a full bond, hit the tenant with a 10% rent increase each year, sell in 4 years time ... great, how much cash have we made .... well, our "investor" has LOST about R750,000 ... ie he would be R750,000 richer in 4 years time if he DOESN'T buy the house !!!!
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