Now I'm not one to spend R12 000 a month on rent. That being said it's a lot better than paying R27 000 a month on mortage. So here's a 3 bedroomed flat in Wembley Square that you can either rent for R12 000 a month, or buy for R2 650 000. What's the ROI on that? Glad you asked:| Down Payment | Monthly Cash Flow | ROI |
|---|---|---|
| R265000 | R-15097 | -68% |
| R530000 | R-12086 | -27% |
| R795000 | R-9075 | -14% |
| R1060000 | R-6065 | -7% |
| R1325000 | R-3054 | -3% |
| R1590000 | R-43 | 0% |
| R1855000 | R2968 | 2% |
| R2120000 | R5978 | 3% |
| R2385000 | R8989 | 5% |
| R2650000 | R12000 | 5% |
You need to put massive R1 600 000 just to not lose any money. If you put down less than a cool million not even capital appreciation (estimated at 6%-8% by banks) is going to save you.
2 comments:
I recently heard of a house that was rented out in the city bowl for R15,000 - only problem was that after a month or two the tenant stopped paying the rent - it has taken 12 months to kick him out ... oh yes, the joys of being a landlord !!
Ouch
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