Do you think investment through property rental can guarantee you to earn higher return in the long run if compare to fixed deposit saving? Anyway, you should make a proper plan before buying any property for investment.
Based on my understanding, if buying a house now, then for sure the price will go up. But, will you really earn? You need to know that some of the money have to be paid to bank interest first and also you might spend some money to renovate your house and other expenses like maintenance fees for the house.
How to Calculate Return On Investment for Property Rental?
Property Type: Apartment
Size: 650 square feet
Housing Price: RM 75,000
Down Payment: RM 7,500
Housing Loan Amount: RM 67,500
Loan Interest Rate: 5% (assumption)
Loan Tenure: 15 years (assumption)
Housing Loan Installment: RM 534 per month
Gross Rental: RM 600 per month
Other Expenses: Maintenance fees and renovation cost
Monthly Net Rental = Gross Rental – Loan Installment
= RM 600 – RM 534
= RM 66
Fixed Deposit vs Property Investment