This property is set on a large block and needs an owner with vision and a sense of "what if". The vendor is quitting the rat race and wants out now.
Quick sale wanted because the vendor is committed elsewhere.
This property offers you potential massive rental yield of approximately 7.48% per annum, based on rent of $360 per week using the calculation detailed below.
RPD: L5
Plan: RP202000
Parish: MACKENZIE
Local Authority: Logan City
Issue Date: Apr 01
VG Number: 00181612695000
Fee Code: Freehold
Owner Code: Private Person
The following statistics apply to Houses in MARSDEN*
Change in Median Price (5yrs) is 1.6%
Annual Change in Median Price (10yrs) is 5.5%
Median Asking Rent for MARSDEN is $350 per week
Average Days on Market is 74 days
*Based on Suburb Scorecard updated monthly. Statistics based on May 2014.
How to Calculate Rental Yield
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If you are considering investing in property, rental yield is a term you have probably begun to notice popping up into conversations and readings around assessing a property's investment potential. Here are some basics to help you understand what rental yield means and how to calculate it.
The property investment dream is to secure a high yield abode in a location that delivers large capital gains, a strong rental return and low management and maintenance costs. Whilst rental yields are certainly not the only consideration being able to calculate rental yield to compare properties will assist you in your purchasing decision.
Yield is a measure of how much cash an asset produces each year as a percentage of that asset's value. Yield is calculated differently depending on the type of asset but for property, the yield calculation is the percentage of rental income for the purchase price.
Rental yield can be calculated as a gross percentage, before expenses are deducted, or as a net percentage, with costs accounted for. Gross rental yield is most commonly used as it is simple to calculate and lets you compare properties with different values and rental returns easily.
Gross rental yield = Annual rental income (weekly rental income x 52) / property value* x 100
* Can be purchase or market value
In the below example the rental yield is 4.55%
Property purchase price = $400,000
Weekly rent = $350
(350 x 52) / 400,000 x 100 = 4.55%
Whilst the gross rental yield is a simple calculation to use it's important to note that it doesn't take expenses into account. A property may have a high rental yield but may also have high expenses making the rental return low when taken into consideration.
If you do want to want a more precise calculation you will need to know (or estimate) the total expenses of property including both purchasing and transaction costs (property purchase price, stamp duty, legal fees, pest and building inspections, any start up loan fees, etc.) and annual costs such as vacancy costs (lost rent and advertising), repairs and maintenance, managing real estate agent fees, home and contents insurance, strata levies (if applicable), rates and charges etc.
Net rental yield = (Annual rental income Annual expenses) / (Total property costs) x 100
There are several factors to consider when investing in property depending on your unique situation and your goals. Contact me if you have any questions or to discuss your situation.
