一些有用的房产投资回酬计算公式

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Rental Property ROI

Calculating the ROI on your Rental
Many rental property owners buy a property, rent it out, collect a net profit and sit back while they continue to collect that income year after year, doing little to evaluate if their investment is a very good one.

If their money was in a stock or mutual fund, these same people would likely look up the prices periodically to see how well their investment is doing. If the price started to go down, they may sell or buy more shares. The same concept should hold true for real estate investments. The trouble is that most people don't know how to compare investments or they don't know the true value of their property. Considering your real estate equity is likely to be a large part of your financial portfolio, it is a good idea to do a regular analysis of your properties to make sure they are still as profitable as when you first began renting.

For example, let's assume you invested $20,000 in a single-family rental near a local college with a market value of $120,000 and a $100,000 mortgage. You manage to collect $415 a month after expenses (mortgage, taxes, insurance etc...). That equates to a 25% return on your investment computed as follows:

Net profit x 12 / your equity investment = ($415 x 12) / $20,000 = 24.90%

5 years later, the property is now worth $145,000 based on similar properties that have sold in the area. You raised the rent a few times and now collect $475 a month profit. You have also paid down $10,000 on the mortgage. Let's calculate the return on your investment now.

Net profit x 12 / your equity investment = ($475 x 12) / $55,000 = 10.36%

Amazingly, the same property that was giving you a 25% return 5 years ago is now only reaping a little over 10%! This happens because your equity in the property has increased to $55,000 but the income you earn has not increased relative to your investment. If you were to sell the house today, you would collect $145,000 and have to pay $90,000 on your mortgage leaving you with $55,000. This is money you could use to purchase another property or other investment at a higher rate of return. In this situation you should consider either raising the rents, or selling the property and using the money for a more profitable investment.

While understanding the accurate value of your rental property may take a little effort to determine, the value typically won't change often enough to warrant an evaluation like this more than once per year. But as you can see, it is great way to check if your rents are in-line with the market or if your investment is returning a good enough profit.

Here is a format that you can use to complete this exercise for your own properties.

Current Equity $__________
Total Return  
  Gross Income $__________
-   Expenses $__________
   =   Net Operating Income $__________
-   Mortgage Payments $__________
   =   Cash Flow $__________
-   Income Taxes $__________
+   Total Principal Payments $__________
   =   Total Return $__________
Calculate % Return  
Current Equity /  $__________
Total Return $__________
% Return on Investment %__________

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Calculating Yield
Gross Annual Income/Sale Price

Yield is the most basic analyzing tool for any real estate investment. It is also the least useful in informing you of the economic value of the property. However it is a quick and easy way to give you a basic idea of where the property is going.

To calculate the yield, simply total up the income you will receive from the property in a given year, then divide this by the sale price. You will receive the yield in a form of a percentage.

For example, let’s say that you are looking at a duplex that costs $100,000. One half of the duplex earns $500 a month, the other $600 for a total of $1100 a month. That gives us $12,100 a year. $12,100 divided by $100,000 gives us a yield of 12.1%. This is not the greatest yield ever, but it is not necessarily bad either However, this basic analysis does not take all of the many factors which must be taken into account: the price of your mortgage, property taxes, other expenses, depreciation values of the house or equity in the long term.

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Gross-Rent-Multiplier (GRM)
Sale Pirce/Gross Annual Rent

The Gross Rent Multiplier is almost exactly the same as calculating the yield. The numbers are the same, but now we are looking at those numbers in reverse. Using the GRM we can find how many years it will take the property to earn the sale price of the property. The lower the number, the better.

Using our example from above, we know that we are earning $12,100 on our $100,000 duplex. When we do the math we learn that it will take about 8 years and three months for our property to earn us the sale price. 8.25 is well within the normal range for a GRM. With older housing that might not be selling for full value we can sometimes see a GRM as low as 5, for newer housing it can often be as high as 12.

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Debt Coverage Ratio (DCR)
Net Operating Income/Annual Mortgage Payments

Debt Coverage Ratio is a tool used more commonly by lenders than by purchases, but it can give you a good idea of the ability your property has in covering its expenses.

In essence we are trying to find the amount of money that you have coming in net over the price of the mortgage in a year. Still looking at our duplex, let us say that costs of maintaining the property in its current condition is about $3,000 a year. This will come off the total of our operating income. $12,100 minus $3,000 gives us a total of $9,100.

To calculate the DCR, we then divide $9,100 by our total annual mortgage of $6300. $9,100 divided by $6,300 gives us a DCR of about 1.44. This is an excellent DCR. Lenders often like to see a minimum DCR of 1.25, and this is well over that amount. We are looking good on our Debt-Coverage Ratio.

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Cash-on-Cash Return (COC)
Cash Flow Before Taxes/Investment

This is a very useful tool in analyzing real estate investments. It gives us a basic look at how much cash we are receiving in any given year verses the amount of cash we initially invest in the building.

First we will have to calculate our cash flow before taxes. This is the gross annual income of the property less the mortgage payments that are made over the course of the year.

Let us look once more at our $100,000 duplex. Say that we made a $25,000 down payment on the building, and thus have to pay a mortgage on $75,000. At 7% interest our mortgage is about $525 a month. Over the course of the year, then, we are paying $6300 off on the mortgage. Subtract that from our $12,100 income and we get a net cash flow before taxes of $5,800.

To calculate our cash-on-cash return, then, we simply divide our net cash flow before taxes by our initial investment in this case $25,000. $5,800 divided by $25,000 gives us a COC return of 23.2%. Almost twice as high a percentage as our yield! Thus, although according the yield we are only earning 12.1% on the property, based on our initial investment verses our net income we are actually getting a return of 23.2%

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This gives us a much clearer idea of the return on our investment than does the yield, but it still ignores such things as tax benefits, equity in the property, etc.

Summary

The methods described here are very basic analysis tools that can give us insight on several basic economic indicators on a property that we choose to invest in. They ignore, however, some of the more complicated aspects of real estate investments: such as calculating tax benefits, estimating equity and so on. These are much more advanced questions that take a lot more time to look at.

Using these tools can give you a good basic idea of the quality of a real estate investment, however. Look at each of the numbers individually as well as as a total. Also remember that these numbers cannot always tell you everything. Every property is different, and must be looked at on its own merits.

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How to Calculate a Return on Investment

ROI = Appreciation +/- Cashflow divided by initial investment

For example:

Purchase Price: $449,900
Appreciation: 6%
Downpayment: $45,000
Cash Flow: $200 negative per month

$449,900 x 6% = $26,994
Negative cash flow for year = $2,400
$26,994 - $2,400 = 24,594
$24,594 divided by $45,000 = 54% ROI first year

If you put 20% down ($90,000) and you have $300 positive cash flow your ROI would be $26,994 + $3,600 divided by $90,000 = 34% ROI

In summary, based on the assumption of 6% appreciation and the cash flow, putting 10% down will give you a better ROI.

jasonhanjk

因为英文所以很多人看不懂？

el/leepy

不是看不懂, 而是懒得看..
要知道, 我们这种中文低的..
看英文需要多费神的..

有谁可以翻译?

LZ?

白奶人

我觉得是format的问题.
好象看到有点怪怪的..

jasonhanjk

原帖由 白奶人 于 12-8-2008 10:55 PM 发表
我觉得是format的问题.
好象看到有点怪怪的..

因该是华文论坛不该打英文字吧！