Posts Tagged → blue
Real Estate Profitability
One of my investor clients asked me if a lease in nunoa than in Las Condes, Providencia and Vitacura is faster. The answer to this question can be as varied as the experiences you have had each of the corridors of properties. Generally, the profitability obtained by a good root is between 5% to 6% and is in direct relation to the amount invested. I.e., to more minor investment profitability. As a practical example, a Department whose value ranges in the $45,000,000, – profitability should be among UF + 5% and 6% annual while a Department whose value is approaching $280.000.000, – income that produces is $1,000,000, – monthly implying an annual profitability of UF + 4.3% approximately. An apartment for rent should amortize over a period of 15 to 20 years. At higher price greater repayment period. Continuing with the previous example, the Department’s $280.000.000,-should amortize over 20 years with what the annual profitability should be skirting UF + 5% and income monthly should be in % 1.170.000, – subject to variations generally down.
In the case of the Department of $45 million, depreciation should be closest to the 15 years with which the expected profitability is UF + 5.5% and the monthly rent, therefore, would be $206.000, – approximately. It is important to consider that these values may vary significantly depending on location, the proximity to the subway, equipment of the sector where is located the property, etc. This in terms of houses and residential apartments as that in relation to the income obtained from business premises and offices these can exceed UF + 12% annual giving cases of up to UF + 17% annual especially in commercial premises located in Top locations. But this is subject for another article. And, responding to my client, I can tell you that to greater value of lower lease placement rate. I would like to clarify some considerations in this response to my client.
