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Old 28-07-2020, 07:06 PM   #4
Supremacy Member
Join Date: Feb 2019
Posts: 5,188
I think you are too optimistic about the capital appreciation of 4% p.a. It is quite unlikely for a $700K condo to be worth $1M ten years later.

But I do think it is not difficult to achieve net rental yield of 6.3% even with only the minimum 25% downpayment. For your $700K example, 25% downpayment plus stamp duty/legal fee will be approx. $193,500.

Monthly rental of $2,200 minus mortgage interest, maintenance and property tax should give you slightly more than $1,000 a month.

Annual returns:
$12,000 / $193,500 = 6.2% without taking into account any capital appreciation. Any capital appreciation is a bonus but your expectation of a $300K gain in ten years on a $700K property is a thing of the past.

But i don't understand your calculation

if you borrow 500k for 2% 30years,
Mortgage payment breakdown
Your monthly payment

The monthly rental yield may be just enough to offset it
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