There is a formula for checking positive geared residential property.
Does this formula also apply to commercial properties ?
Since commercial tenent pays some of bills that usually are payed by landlord in residential properties would that change the formula somehow ?
Yea the forumla is simple, if you have less expenses than income, anything will generate a profit. VERY VERY SIMPLE STUFF!
Work out what expenses you will incur, work out what income you will generate, and then simply subtract one from the other, its not magic just commonsense
..I guess you didn’t read Steve’s book and don’t know what I ‘m talking about.
Quote:I guess you didn’t read Steve’s book and don’t know what I ‘m talking about.Using the 11 second solution works for both resid and comm properties. Due to your reasons specified the cash on cash return formula would be more accurate after the outgoings payable by the tenant had been determined
RegardsFrom what I gather in commercial dealings the leasee pays for the rates and insurance. So don’t include that as cash outgoings in your calculations.
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