Investments: Projections
Financial Projections
3 bed |
|
|
|
|---|---|---|---|
Gross Revenue ex VAT |
£33,000 | £4,950 | |
Management Charge ex VAT |
£13,200 | ||
Service Charge ex VAT |
£1,500 | ||
Rates & Insurance |
£1,100 | ||
TOTAL Charges |
£15,800 | ||
Net owner revenue |
£17,200 | ||
VAT received on lettings |
£4,950 | ||
VAT charged on service & commission |
- £2,205 | ||
VAT payable to HM Customs |
- £2,745 | ||
Net income received |
£17,200 | ||
Initial investment |
£295,000 | £38,478.26 | |
(cost of cottage) |
£256,522 | net | |
Net yield (net rev / net cottage cost) |
6.71% | ||
Annual interest (75% loan at 5%) |
£9,620 | ||
Opportunity cost (6 weeks use of cottage) |
£3,915 | ||
IAFC (Income After Financing & Opportunity Costs) |
£11,495 | ||
Equity (25% of initial investment) |
£64,130 | ||
Return on equity |
17.93% |
Assumptions:
- That investor is VAT registered and can bridge the VAT on the purchase for a month before claiming it back
- Revenue based on 65% occupancy
- Commercial Interest Rate at 3.5% over base
- Illustrative Only, this does not constitute a formal offer and will be subject to terms and conditions and formal contract
