All Topics / Hotch Potch / calculating returns???

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  • Profile photo of wannabe2wannabe2
    Member
    @wannabe2
    Join Date: 2003
    Post Count: 65
    October 1, 2003 - 11:20 am

    i cant work out why if using the calculations shown on page 5 the more rent received i calculate it with the less the return???
    eg 200pw X 52. bought for 154,000 =%14.80
    220PW X 52. bought for 154,000 =%13.46
    is this right?
    help[xx(][xx(]

    Profile photo of jezjez
    Member
    @jez
    Join Date: 2003
    Post Count: 31
    October 1, 2003 - 11:28 am

    Not sure how your calculated your percentages but this is what I do…
    (200*52)/154000 * 100 = 6.75%
    (220*52)/154000 * 100 = 7.43%

    Both low yeilds that probably won’t cover your expenses. If a house qualifies for the 11 second rule then the yeild should be about 10.4%. E.g. a house that returns $200 should cost you no more than $100,000, so:
    (200*52)/100000 * 100 = 10.4%

    Cheers,

    Jeremy Lunn
    Melbourne

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