Here's a 1 bedroomed apartment in Lower Gardens described as an 'investment for years to come'. Well that's partly true as you're going to have to hold onto this thing for a loooong time if you want to make any money out of it. It's on sale for R850 000 and has a net rental income of R3 250 (R4 000 - R750 in levies). If you buy it with a 100% bond the difference between the bond and the rent is about 2.3 times the actual rent. Here's the ROI and payments required.| Down Payment | Monthly Payment | Cash Flow | Annual Income | ROI | Cap. Appr. Required |
|---|---|---|---|---|---|
| R0 | R10879.98 | R-7629.98 | R-91559.77 | 10.77% | |
| R85000 | R9791.98 | R-6541.98 | R-78503.79 | -92.36% | 9.24% |
| R170000 | R8703.98 | R-5453.98 | R-65447.82 | -38.50% | 7.70% |
| R255000 | R7615.99 | R-4365.99 | R-52391.84 | -20.55% | 6.16% |
| R340000 | R6527.99 | R-3277.99 | R-39335.86 | -11.57% | 4.63% |
| R425000 | R5439.99 | R-2189.99 | R-26279.89 | -6.18% | 3.09% |
| R510000 | R4351.99 | R-1101.99 | R-13223.91 | -2.59% | 1.56% |
| R595000 | R3263.99 | R-13.99 | R-167.93 | -0.03% | 0.02% |
| R680000 | R2176.00 | R1074.00 | R12888.05 | 1.90% | -1.52% |
| R765000 | R1088.00 | R2162.00 | R25944.02 | 3.39% | -3.05% |
| R850000 | R0.00 | R3250.00 | R39000.00 | 4.59% | -4.59% |
4.59% maximum yield if you buy the whole thing in cash, and that's before maintenance and vacancy. An 80% downpayment is required to break even on cashflow and if you take out a 50% bond you'll need 3.09% capital appreciation just to not lose any money at all.
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