What is your total rental income for 10 years?

Buy Australian real estate for 42 million yen … What is your total rental income for 10 years? The reason for existing is “steady lease pay” as opposed to “capital additions”

In the corona wreck, real estate prices in major and local cities in Australia were higher than they were during the corona outbreak. Multiple factors (such as the success of corona control measures, the government’s implementation of stimulus measures, and the continuation of the lowest policy rate ever by federal banks) continue to raise prices (see: Australian real estate “corona wreck” But behind the scenes of “price increase”). Although buying and selling is still active and the market seems to have begun to heat up a little, the willingness to buy is still high, and many analysts, including banks, predict that the momentum will not slow down in the last 6 to 12 months. doing. By the way, when it comes to overseas real estate, the rise in real estate prices, the so-called “capital gains,” is often talked about. In Southeast Asia, we often see advertisements with the headline that we can expect price increases of 15% to 20% in a short period of time. On the other hand, the basic style of real estate investment in Australia is “stable rental business profit”, and the main approach is a conservative stance that “price will gradually follow as the country grows”. Will be. There is a cycle in the real estate market. It’s good when it’s on an uptrend, but you also have to think about, for example, whether the property can be maintained until the next peak when the market changes and the price adjustment phase begins. not. In other words, it is necessary to confirm whether stable rental income can be continuously secured regardless of fluctuations in the trading market. The important point in doing so is to confirm the existence of a “property borrower market” in that country, that is, in the area where the property is located. One way to check for the existence of a borrower market is to check the Vacancy Rate & Trend announced by real estate research companies and the government. Looking at these indicators, you can roughly guess whether you can continue to secure stable borrowers after purchasing real estate.

Vacancy rates in major cities remain at a low level of 1.2% to 2.4%

By the way, the vacancy rate of the most recent (April 30, 2021) major Australian cities  the vacancy rates are 3.1% in Sydney, 4.0% in Melbourne, 1.4% in Brisbane, 0.9% in Perth, 0.7% in Adrade, 0.7% in Canberra, 0.5% in Darwin and 0.5% in Hobart. The average for each major city is 1.9%. Looking at this vacancy rate, we can see at a glance that the Australian rental market is a good lender market for landlords. Interestingly, 12 months ago, the average vacancy rate in each major city during the new corona outbreak was 2.6%, with the most recent vacancy rate being lower. If you look closely, the vacancy rate has dropped significantly in other cities due to a slight decrease in Sydney and an increase in Melbourne. This is believed to be due to the fact that many people have left the metropolitan area and moved to other cities during the last 12 months, the Corona Surgery. In fact, in Queensland, where I live, there are about 30 million influxes (migrants) from other states in 2020, and the vacancy rate on the Gold Coast is around 1.3%, so there are not enough rental properties. The situation. If this situation is just a transient phenomenon, the continuation of a stable real estate leasing business remains questionable. In this regard, you can infer a scenario by looking at past trends. Chart 2 shows vacancy trends over the last 15 years in major Australian cities. As you can see, the vacancy rate is 1.2% to 2. It has remained in the range of 4%, confirming that the Australian rental market is still favorable to landlords. During this time, there were price fluctuations in the real estate market, but we can see that the rental market was always normal. For a while, the property that provided accommodation for domestic and foreign tourists in urban areas at the time of the new corona (similar to private lodging in Japan) closed the border and state border, and the rental market at once with the timing of lockdown There was a time when it was sold in Japan, and there was an exception that the vacancy rate soared to the double digit level in some urban areas. After that, when the spread of infection subsided and regulations on corona countermeasures (movement of people, etc.) were relaxed, the rental market settled down to the current level. By the way, at the beginning of this article, the basic style of real estate investment in Australia is “stable rental business income”, and with a conservative stance that “price will gradually follow as the country grows”. I told you that this approach is the main one. However, even so, I don’t think it’s easy to imagine, so I’ll show you a simple number at the end. For example, suppose you buy a property for $ 500,000 (about 42 million yen *). The real estate yield here has been around 3% over the last decade. The rate of increase in rent will also be about 3%, so if you run a rental business for 10 years, for example, (1) rent income will be about $ 172,000 (about 14.45 million yen *) in total over 10 years. If the annual rent for the 11th year is $ 20,159 (about 1.69 million yen *) and the rent is discounted by a real yield of 3%, (2) the return amount will be about $ 672,000 (about 56.45 million yen *). .. Therefore, the total of (1) and (2) is $ 844,000 (about 7, It will be about 0.9 million yen *). * 1 Calculated at $ = 84 yen Whether or not this amount meets the expected value depends on the investor’s stance. However, Australian real estate investment is easy to imagine a return on the investment amount, and it can be said that it is also evidence that a stable rental market exists. Representative of Wide Estate Co., Ltd.The average vacancy rate in each major city during the new corona outbreak was 2.6%, with the latest vacancy rate being lower. If you look closely, the vacancy rate has dropped significantly in other cities due to a slight decrease in Sydney and an increase in Melbourne. This is believed to be due to the fact that many people have left the metropolitan area and moved to other cities during the last 12 months, the Corona Surgery . In fact, in Queensland, where I live, there are about 30 million influxes (migrants) from other states in 2020, and the vacancy rate on the Gold Coast is around 1.3%, so there are not enough rental properties. The situation. If this situation is just a transient phenomenon, the continuation of a stable real estate leasing business remains questionable. In this regard, you can infer a scenario by looking at past trends. Chart 2 shows vacancy trends over the last 15 years in major Australian cities. As you can see, the vacancy rate has been in the range of 1.2% to 2.4%, confirming that the Australian rental market is still favorable to landlords. During this time, there were price fluctuations in the real estate market, but we can see that the rental market was always normal. For a while, the property that provided accommodation for domestic and foreign tourists in urban areas at the time of the new corona (similar to private lodging in Japan) closed the border and state border, and the rental market at once with the timing of lockdown There was a time when it was sold in Japan, and there was an exception that the vacancy rate soared to the double digit level in some urban areas. After that, when the spread of infection subsided and regulations on corona countermeasures (movement of people, etc.) were relaxed, the rental market settled down to the current level. Well, at the beginning of this article, Australian real estate investmentI told you that the basic style of is “stable rental business profit”, and the main approach is a conservative stance that “price will gradually follow as the country grows”. However, even so, I don’t think it’s easy to imagine, so I’ll show you a simple number at the end. For example, suppose you buy a property for $ 500,000 (about 42 million yen *). The real estate yield here has been around 3% over the last decade. The rate of increase in rent will also be about 3%, so if you run a rental business for 10 years, for example, (1) rent income will be about $ 172,000 (about 14.45 million yen *) in total over 10 years. If the annual rent for the 11th year is $ 20,159 (about 1.69 million yen *) and the rent is discounted by a real yield of 3%, (2) the return amount will be about $ 672,000 (about 56.45 million yen *). .. Therefore, the total of (1) and (2) is about $ 844,000 (about 70.9 million yen *). * 1 Calculated at $ = 84 yen Whether or not this amount meets the expected value depends on the investor’s stance. However, Australian real estate investment is easy to imagine a return on the investment amount, and it can be said that it is also evidence that a stable rental market exists.

 

Listestates

Please follow our facebook page to connect us.

Comments

mood_bad
  • No comments yet.
  • Add a comment