Hi All
I was going to ask my accountant this question but being the weekend and with my level of curiosity Monday is too far away.
Could someone please explain the difference between gross return annually and nett return annually on an IP, I think it is Gross you get paid the return before all the payments are made to Body corporate, rates etc and Nett return is after all of these have been paid, am I on the right track?
Thanks and have a great day
Martine[blush2]Yes Martine,
You’re pretty much on track, except that the gross amount will not necessarily be paid to you if you engage a PM in which case the agency will take out their management costs, GST and any repairs that you give them authority to conduct.
Gross rental yield is what the return is before you take out ALL associated costs including PM fees, BC fees, rates, insurance, land tax, repairs and so on. Nett threefore is the end result when all associated costs have been paid out, and it is what you are left with.
Do remember that although some costs are deducted by your PM (as stated above) it is always wise to keep money aside for when those other bills come in, as they surely will!!! [blush2]
Cheers,
Jo
the software I use (PIA PRO) gives both gross and Nett Yield and also the most important to me which is IIR (internal rate of return) tells me in a flash if the deal is close to what I am looking for in less than five minutes providing I have all hte relevant information such as Insurance, Management costs, REpairs, Rates, vacancy percentage,CPI etc
Cheers,
KiwiLooking for Positive cashflow solutions?
Look no further
Wraps-Lease Options & JV’s
http://www.kiwilogic.biz
We are investing in NZ so if you are looking for + cashflow properties…contact: [email protected] to join our database.Thanks Monopoly and Kiwi Fulla
This now makes more sense, Kiwi Fulla what is the name of the software and where do I get it from.
Regards
Martine[cap]It is called PIA PRO
http://www.somersoft.com.au …. from memory
Cheers
KiwiLooking for Positive cashflow solutions?
Look no further
Wraps-Lease Options & JV’s
http://www.kiwilogic.biz
We are investing in NZ so if you are looking for + cashflow properties…contact: [email protected] to join our database.Hi Martine,
Correct address is http://www.somersoft.com (no au) – Kiwi’s memory was a little hazy[biggrin]
Derek
[email protected]
0409 882 958
Property investment advice and researched property in quality locations available.
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