Aug 23 2009, 05:46 PM
QUOTE(jasonhanjk @ Aug 23 2009, 01:05 PM)
Err, not really.
Here is the calculation for my third unit.
Town house
Market value RM80k as of today.
Purchase price RM60k
Stamp duty RM50
Bankers cheque RM5
Loan RM57k @ 4%, 30 years (estimate)
Down payment 5% @ RM3k
Agent fees RM3k
Lawyer fees RM2k (estimate)
Today I put in RM8055, if the price remain the same for 5 years and I sell.
My profit would be RM80k - RM57k - RM8055 + amortization + cashflow = RM14,945 + amortization + cashflow
First, the cashflow.
Rental is RM450 per month.
Maintenance is RM33.
Mortgage RM272
Cashflow for 5 years = (RM450 - RM33 - RM272) X 12 X 5 = RM8700
Secondly, amortization.
For 60 months the tenants put money into my town house's equity.
That comes up to RM5595.
Finally, the profit is RM14,945 + RM8700 + RM5595 = RM29,240
Compare to the RM8055 I put in today, the gain for 5 years later would be extra 363%.
If I buy a developing property today, I put my money down and it get traps for 3 years before the project is fully complete then I can sell it away.
The question is, what is the market value after the project is complete?
I don't know as there is no past history for reference.
Also I lose money every month as I have to pay interest on my loan.
When calculating the gain for the incomplete property, one has to add interest into the calculation.
For a developed property can be rent out immediately and the tenant pay for my interest.
So it's not required to add into the calculation.
Hi Jason,Here is the calculation for my third unit.
Town house
Market value RM80k as of today.
Purchase price RM60k
Stamp duty RM50
Bankers cheque RM5
Loan RM57k @ 4%, 30 years (estimate)
Down payment 5% @ RM3k
Agent fees RM3k
Lawyer fees RM2k (estimate)
Today I put in RM8055, if the price remain the same for 5 years and I sell.
My profit would be RM80k - RM57k - RM8055 + amortization + cashflow = RM14,945 + amortization + cashflow
First, the cashflow.
Rental is RM450 per month.
Maintenance is RM33.
Mortgage RM272
Cashflow for 5 years = (RM450 - RM33 - RM272) X 12 X 5 = RM8700
Secondly, amortization.
For 60 months the tenants put money into my town house's equity.
That comes up to RM5595.
Finally, the profit is RM14,945 + RM8700 + RM5595 = RM29,240
Compare to the RM8055 I put in today, the gain for 5 years later would be extra 363%.
If I buy a developing property today, I put my money down and it get traps for 3 years before the project is fully complete then I can sell it away.
The question is, what is the market value after the project is complete?
I don't know as there is no past history for reference.
Also I lose money every month as I have to pay interest on my loan.
When calculating the gain for the incomplete property, one has to add interest into the calculation.
For a developed property can be rent out immediately and the tenant pay for my interest.
So it's not required to add into the calculation.
1) You have already profited 20k from your astute purchase and this caused a big jump in your returns. If you assume you bought at market price( assume not everybody has your skills to buy cheap), you would have made only RM9240 over 5 years. Furthermore, you have not factored in vacant period, maybe some repairs, assessment, quit rent, your travelling expenses etc etc and maybe your labour time!
2) Assume, if interest rates go up to 6%, how much would you have made (or lost) instead?
Looking forward to your calculation.
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