Thursday, 12 September 2013

Real Estate for possible Cash flow

My Personal Finance project is due next 2 week. There are 2 choices for this project. You can either do about owning a car in 5 year, Tax Sheltered Plans or Real Estate for Cash Flow. I choose to work on Real Estate for Cash Flow because it probably is the most familiar thing with me. I have no knowledge as well as the idea on Tax Sheltered and I don't really know much about car's fees so I didn't choose them. 

Even though Real Estate is the most familiar thing with me out of all but there's still a lot of things that i don't know about. So here is what I have to do. I have to choose 2 property that cost the same amount, find their gross rental yield 9% at least and even apply further with mortgage payment. 

So...now, I have to find a country that have gross rental yield at least 9%. I was searching on the internet, i couldn't find any that yield 9 % in Singapore nor Vietnam. Apparently, I have to go with safe choice, these are the country that I lived and living right now. I was stuck so i went to my parents and asked them for some help. They told me that there's no property that give you a gross rental yield of 9% in Vietnam anymore. There are used to be. And obviously not in Singapore. So they asked me to have a look on properties in Kuantan, Malaysia where we lived before moved here. We used to live in this gigantic house in Kuantan. Its monthly rent cost is RM 4,800 a month after negotiated from the initial RM 5,000. For the "Kuantanist", a RM 5,000 house is considered as a super huge house with big yard or villa (not really villa but yeah). We were expat, we didn't care about the rental. My dad just wanted to know so he asked them how much they are selling the house for, and it was around RM 550,000. 

RM 5,000 a month for rent, RM 550,000 for sale. It gives a roughly 11% yield. So i decided to choose Malaysia. 
That was basically what I was doing for yesterday. I am going to look up for the salary and salary tax in Singapore, mortgage down payment interest rate, how many years i have to pay off my mortgage,...

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