News Hong Kong Property & Finance

how to calculate return on investment

ORIGINAL POST
Posted by highdesertnow 18 yrs ago
what is the formula to calculate roi? If I buy a 3 million dollar flat how much should i rent it out for? thanks

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COMMENTS
glorypc 18 yrs ago
Would need some more information to work out roi but assuming you borrow the maximum 70% or $2.1 million over 25yrs on capital and repayment then a P-1 interest rate of 4.8% would cost you roughly $36,100 per quarter. Therefore you would need to get over $12000 per month in rent for your investment to be self sufficient. This of course is not taking into consideration your original deposit.

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highdesertnow 18 yrs ago
how do you get the 36,100 per quarter? I would like to get a loan for 70%. thanks

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glorypc 18 yrs ago
I have a program that calculates loan repayments.


There are also facilities available now in HK that allow you to borrow in foreign currencies with much lower interest rates. You can also borrow on an interest only basis reducing your outgoings even further.

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