Hi there, this is my first posting and I’m a complete newbie, so please be gentle, and use small words so I can understand. Thanks. My question is in regards to a property I’m wanting to wrap. I need to present something worthwhile to investors. I have already found a buyer so half the job’s done. The property is in rural NSW and requires a 20% deposit as banks only loan up to 80% out there. This only gives an annual ROI of 12%, however, if they cash out in 5 yrs and I add up the money returned to the investor, including the initial outlay, then divide that by 5 I come up with 36% ROI p/a. Can I do that? Can you actually add up the total return and then give an average ROI for each of the years? It sounds a lot better that way (although I would like to know if that is actually a reasonble return). I haven’t included the money I pay myself in those sums. I would like to know if the numbers theory is ok? Thanks for the help.
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