Calculator For Rental Property Investing

Calculator For Rental Property Investing
A calculator for rental property investing is used to evaluate the different options available while you consider investing in a rental property. This calculator is used to help screen rental applicants to help them understand how they can plant out their monthly payments or rents while taking into account both income and expenses.

The calculator for rental property investing will also tell you how much housing benefit and council tax benefit you should get. For example, if you are paying house rent on a monthly basis then this calculator can tell you whether it is feasible to purchase the house right away with the existing burden of paying monthly installments to the bank coupled with the saddle of monthly rent.

The result of the calculation is based on the number of assumptions and additional information. You will need to do some sensitivity analysis using a base set of best guess values and then changing some key variables like rent, capital growth and inflation rates, to judge the effect of these changes to these conditions. Some initial purchase costs need to take into consideration when you use a calculator for rental property investing. They are as follows :

* Land and building costs – This cost is found on the property valuation. You can also ask your real estate agent for assistance.
* Depreciation – For the purposes of the calculator for rental property investing depreciation is based on the opening tax value of buildings only.
* Chattels cost – This cost is also found on your property valuation. If you don’t have a property valuation then you can ask your agent. Also, make a list of chattels and approximate second hand values. The calculators have a specific depreciation for chattels for tax purposes. Unlike the building the chattels wear out and therefore the calculator for rental property investing includes an annual payment equivalent to some 10% of the value of the original chattels for cash flow purposes. The percentage is subject to change,
* Legal fees(deductible) – These include all expenses that were incurred while arranging a mortgage and drawing up a tenancy agreement.
* Legal fees (non-deductible) – These are the legal costs involve in buying or selling a property that are not deductible. These costs are added with the cost of the property and capitalized in the calculator for rental property investing.
* Valuation and survey fees – These include the valuation, survey and building fees. These costs are also added to the cost of the property and are capitalized on the calculator for rental property investing.
In this way, even the mortgage has details that need to be considered in the calculator for rental property investing. You also need some ongoing information like your gross annual income, inflation rate, real capital growth rate, weekly rental, occupancy rate, property management fees, annual rates, maintenance, insurance and other expenses.

You also need to calculate the cash flow from the rental property investment so that you know whether the investment is a good one. In this way, you can see to your rental property investing in a good way. There are many calculators for rental property investing on the web that can help you to decide on a property that is profitable.