Real Estate Investor Magazine South Africa October 2014

RESIDENTIAL Capital growth @ 5% pa Property Value Monthly Capital rental growth income ROI @ 10% escalation Annual rental income Total Capital Growth + Rental Income Return on R500 000 investment Year 1 500,000 25,000 5,000 60,000 85,000 17.00% Year 2 525,000 26,250 5,500 66,000 92,250 18.45% Year 3 551,250 27,563 6,050 72,600 100,162 20.03% Year 4 578,813 28,941 6,655 79,860 108,800 21.76% Year 5 607,753 30,388 7,320 87,846 118,233 23.65% Capital growth @ 5% pa Property Value Capital growth ROI Monthly Monthly Annual Total rental income rental Capital Return on income after income Growth R50 000 @ 10% expenses (after + Rental investment escalation (R5000) expenses) Income Year 1 500 000 25 000 5 000 - - 25 000 50.00% Year 2 525 000 26 250 5 500 500 6 000 32 250 64.50% Year 3 551 250 27 563 6 050 1 050 12 600 40 163 80.33% Year 4 578 813 28 941 6 655 1 655 19 860 48 801 97.60% Year 5 607 753 30 388 7 321 2 321 27 846 58 234 116.47% Year 6 638 141 31 907 8 053 3 053 36 631 68 538 137.08% Year 7 670 048 33 502 8 858 3 858 46 294 79 796 159.59% Year 8 703 550 35 178 9 744 4 744 56 923 92 101 184.20% Year 9 738 728 36 936 10 718 5 718 68 615 105 552 211.10% Year 10 775 664 38 783 11 790 6 790 81 477 120 260 240.52% RESOURCES P3 Investment Group www.reimag.co.za October 2014 SA Real Estate Investor 33

Real Estate Investor Magazine South Africa October 2014 | Page 33