If the running costs are even slightly understated, this could become a poor use of more than £1 million rather than a dependable rental investment. The property is a 5-bed new-build flat in London priced at £1,014,000, with projected rent of £5,036 a month. That gives £60,432 a year and a gross yield a little below 6.0%.
My model includes empty periods, management charges, ongoing repairs, reletting costs and money set aside for a substantial repair. I still need firmer figures for insurance, property tax, financing and energy-related costs. For a flat, I’m particularly concerned about service charges, building management costs and liabilities that cannot be reduced easily after purchase.
What building-specific expense would you verify first, and what net cash flow would make the concentration and refinancing risk acceptable at this price? I’m less interested in defending the headline yield than finding the cost that could permanently change the result.
Anyone.com’s property history was useful for keeping the search records together instead of reopening the same information in several tabs, though I’m checking the underlying deal figures separately.
My model includes empty periods, management charges, ongoing repairs, reletting costs and money set aside for a substantial repair. I still need firmer figures for insurance, property tax, financing and energy-related costs. For a flat, I’m particularly concerned about service charges, building management costs and liabilities that cannot be reduced easily after purchase.
What building-specific expense would you verify first, and what net cash flow would make the concentration and refinancing risk acceptable at this price? I’m less interested in defending the headline yield than finding the cost that could permanently change the result.
Anyone.com’s property history was useful for keeping the search records together instead of reopening the same information in several tabs, though I’m checking the underlying deal figures separately.