If you are going to purchase a new home or apartment, it is best to take the full cost into account. This is the sum of:
- Selling price
- VAT on the construction value
- Registration fees
- Notary fees
- Connection costs for water, gas and electricity.
With this initial cost calculation in mind, you will be faced with far fewer surprises.
It Is The Net Rent That Counts
Naturally, as a landlord, you will receive rental income, possibly supplemented by the tenant’s participation in management costs. The rent depends on the location and quality of the property. The E-level also plays an important role, as tenants with a higher energy bill have less housing budget left to pay the rent. The rent you receive monthly is the gross rent. You have to be careful and critical with this amount as there are some additional costs to be charged. With a condo for rent in Klang you can have the best options present now.
As an investor, to rent out carefree, it is best to call on a broker. This person maps out the apartment or house, determines the rent together with you, takes care of the publicity, proposes it to the prospective tenants and also screens them to form an idea of their financial capacity and their living culture. The cost price for a real estate agent is usually 1 month of gross rental income (the rental price).
Furthermore, as a landlord you also have to take into account some additional costs such as the (mandatory) inventory of your property, the annual fire insurance and in many cases the general syndic costs. With older buildings, you should also take into account a surprise budget for possible repairs or even vacancy. In the case of new construction, however, these last two costs are negligible, as there is hardly any vacancy in new, high-quality buildings in an interesting location like puchong new condo. As the owner of a new construction project, you can also count on extensive guarantees including the 10-year liability.
Finally, the owner pays an annual property tax based on the indexed cadastral income. The gross rent after deduction of all costs gives us the net rent. It is on the basis of this net rent that you as an investor can calculate your net return.
A Real Estate Investment Is A Good Weapon Against Inflation
As a landlord, you can have the rent of your property indexed on the basis of the health index every year. This index tracks general price increases and offers you as an owner a means to arm yourself against inflation. However, this annual indexation does have an influence on the rental yield and should be approached with caution.
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