3 Bedroom Terrace House
Typical example from a customer portfolio of financial returns on a 3 bedroom terrace house.
Purchase price in 2019
£80,000
Rental Income
Gross monthly rental
£695.00
Managing agent fees for the month
£69.40
Income for the year
£7,506.00
Other costs that have to be paid for in the year
Tenancy set up fees
£534.00
House insurance for the year
£260.00
Electrical test (every 5 years) pro rata for the year
£36.00
Selective licensing (every 5 years) pro rata for the year
£120.00
- Gross Income for the year
(£7,506.00 subtract costs £1,246.00) £6,260.00
- Return on Investment (ROI) year 1
- Net income for the year £6,260 / Capital invested £80,000 ROI 7.8%
- Growth in property values in Liverpool 2020 average price rise 15%
- Results in the Capital increasing £12k
- Return on Investment (ROI) year 2
- Tenancy set up costs N/A
- Gross Income for the year (Subtract £7,506.00 - £712.00) £6,794.00
- Net income for the year £6,794.00 / Capital invested £80,000.00 ROI 8.4 %
**Note –The propertey was rented out for the full 12 months, howerver, for contingency planning allow for only 10 months occupancy of the property per year.