Can anybody enlighten me? Thanks.
Can anybody enlighten me? Thanks.
Gross yield = rental over a yield divide by current price.
Nett yield = rental over a yield minus all expense then divide by current price.
U take current price of condo because u can sell it and invest to get yield...
There is 1 more-
Nett yield from your outlay = rental per year minus expense minus interest then divide by your outlay...
Depends on what u are calculating.
Last edited by chestnut; 25-11-13 at 08:33.
more interestingly, try:
take the total net amount earned from rental (minus monthly loan repayment, maintenance, property tax, agent's fee, income tax, everything) divide by your total initial cash contribution (20% + stamp + legal fees etc) towards the purchase
best best best way dont calculate just enjoy whatever u earn...go holiday buy nice car...thats the power of "OPiuM"...Other peoples Money
In the final analysis.....its NOT whether you have a diploma,degree,masters OR PHD....its whether you have a HDB/PC/EC or LANDED...
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Gross rental/ the amount of deposit u put to pay property
gross yield / price is the worse possible calculation that is touted by ppty agents. some times the net yield might become negative even with a decent gross yield.
There is no good or bad location. There is only good or bad price.
dont waste time calculating rental yield based on historical purchase price.
"Never argue with an idiot, or he will drag you down to his level and beat you with experience."
Also don't be too fixated by the magic no of 3,4 or 5% rental yield. You have to look at the gross amount you are getting also.
For eg, S$2.5k HDB rental is peanuts, though yield may be super gd.
Prospective Buyer will be looking at [(Monthly rental x 12) less annual expenses] divided by offer price of seller. Existing owner will be be looking at [Monthly rental x 12) less annual expenses) divided by purchase price. There is no right or wrong way as long as it makes you feel happier.
If you want to talk about historical purchase price, then someone will say 15%, 10% and others will say 3% all from the same development.
Is that even meaningful to discuss at all?
What do you think they used to calculate rental yield?
https://www.squarefoot.com.sg/market-watch/rental-yield
"Never argue with an idiot, or he will drag you down to his level and beat you with experience."
you have to use present day value becoz you have to assess between keeping the house and the yield thereafter, or sell at market price and use the money for alternative investment to give you same (or higher) returns.
There is no good or bad location. There is only good or bad price.
the beauty of it is that he has this option & not scare even if rental mkt soften. this is the beauty of buying early...
even for ppl who bot at 96/97 peak; even if not much capital gain at current valuation for some old condos... their loan has been paid down by so much by today; they can afford to be very competitive in pricing their rental units
if you dont't own any property, you're short. take cover quickly
"Never argue with an idiot, or he will drag you down to his level and beat you with experience."