ROI (Return on Investment) Calculator
The return on investment (ROI) calculation is an essential part of planning or reviewing any property investment purchase. An ROI calculation simply looks at how much a property costs, and how much money it makes, allowing you to see it as a percentage of profit or loss.
As you will know if you have previously purchased an investment property, there are several costs included, alongside the singular purchase price of the property. This includes the deposit, legals, surveyor fees, broker fees, SDLT, and any refurbishment costs necessary. There can add up to a significant sum of money, and when calculating the gross yield, none of these figures are taken into consideration, meaning you may be relying on inaccurate figures.
To work out the accurate ROI on your investment property, we recommend using the above calculator. By entering your monthly income, monthly expenditure, asset value, and cash investment, you can discover the following: Annual ROI, Annual Yield, Cash Investment, Annual profit.
Rental gross yields can still be valuable measures if used correctly. They are useful to compare when researching areas to invest in. For example, if you see that the average rental yield in Lawley Village is 6%, however in Muxton it is 7%, it may help with your initial decision on property investment location.