I want to invest 4 million rupees in the property either residential or commercial, expecting rental of the property per month must not be below Rs 30,000. Kindly give your valuable advice, primarily looking for a property in Lahore or near Lahore.
Same question for me
Rental return is mostly 5 percent of property value. So may not be possible to get rent 30 thousand on investment of 40 lakh.
Rentals rarely bring high roi. However, if you really need a scoop with less money, you gotta do some effort to identify such option out of the market. I won’t say, its an easy deal to pursue.
Kindly visit the following links to find appropriate homes, flats and shops for investment and contact the agents or owner of that property to know about the current expected amount of rentals for these properties.
for flats: Flats
for shops:
@mbs ...Yes rentals do not bring very high roi but the roi increases.
According to ajmal the rental return is 5% of property value. Let us assume this 5% remains the same. So if the value of the property increases, the rental value will also increase proportionately.
Automatically, the roi percentage will increase even if property value percentage (5%) remains the same - because your investment remains the same yet property value increases.
Secondly, investment for rental is safe because your principal asset is safe and appreciates in value due to rise in property prices. On the other hand if you invest in business, the assets (such as equipment which is your capital contribution) depreciate in value, and there is a risk that expected revenues will not be reached due to foreseen and unforeseen circumstances - eg. Load shedding, drop in real income and purchasing power of middle class due to devaluation and inflation. Costs are getting higher by the day for example insurance costs, imported items costs, energy costs are sky-rocketing but consumers do not have the economic muscle to keep the businessman afloat by paying for higher prices.
Personally i want business to flourish more than property because that is the sign of a vibrant and powerful economy. But we also have to be realistic.
What do you think?
I have an oppurtunity in islamabad, where u can invist around 7 million and can get rent upto 50000 to 90000 per month. Ghauri town, buy a commerical plot around 6 million, Construct shops (temporarly shops) cost u around 6 to 7 lac. Rent it out from 15 to 20 thousand per month I have done the same and making 60000 per month from it. If u can construct basement and ground flour then u can earn around 90000 to 100000 per month.
I have an oppurtunity in islamabad, where u can invist around 4 million and can get good profit from it. If u cant spend around 7 million as i mention in my previous post.
Buy plots in ghauri town phase 7 which is being under construction and in 6 months or so , it will give u good profit. Currently its prices is from 145000 per marla to 155000 per marla. Buy 5 marla plots as many as u can and keep it for 6 months or so , u will get resonable profit. I am avaling this oppurtuanity and getting good respoce.
@pk1 yes the value of land and rentals increase pertaining to real growth and inflationary pressures. And i agree, its the safest investment but the safer it is, the lesser the return.
Now A realistic income expectation on 4mn investment would be 20000/mo. Now even the rentals are increasing over years coz of inflation or real growth, but the house/shop is depreciating physically as well- more maintenance costs, etc
Secondly, it takes roughly 13-15 yrs min to recover your initial investment thru rentals, even if the rental income more than doubles in this period to 50000. But at the same time, your initial capital should also have become 12mn after 13-15yrs just because of inflation and currency devaluation.
So where's the GAIN then, you block your capital, you put in all your efforts, you deal with messy tenants and you remain engaged with dealers to show ur property and sign the contracts and deal on day to day water, gas maintenance issues? You hardly break even on your investment after such a long period.
So overall, i would say a commercial property might lead you to a good income, its very hard to make good bucks with residential properties.
And yeah, am not ruling out the possibility of very good returns, if one gets hold of a great opportunity or spends his money wisely and timely.
Generally, its easier to trade in plots, hold em for the right period, sell em and you're outta it. Not a periodic cash income but Less hassle, more return in one go.
Ref: irr, future value of money
Hi mbs i again love u a lot you are are extra ordinary genius i am very impress with your wise and nice sayings. Allah bless you. Wish every one should be wise like you. Love u love u really love u
@mbs
Good analysis but why an expectation of a profit of 20000 on an investment of 4 million? You can get 40000 per month on the same investment if you put in national savings. Interest factor is there but the returns are greater and there are no risks. The interest factor is discouraging though and forces many like us to look for halal options.
Being a muslim i never go for intrsut , intrsut is like a war against allah and this is not sadi by me its a saying of allah. Can confrm from any knowledgeable man of islam (alam). So as far as ghauri town is concerned at the moment i have seen this is the only society that is giving reasonable profit and benfites to its invisters in short time. I am doing this property work since 2004 in o-9, pwd, bharia, dha, i/8 ,i9,g 11..... But ghauri town is town is the only society which i have seen doing so well. Let me give u an example
Last year commerical plots were around 4 lac to 4:50 lac and now 9 lac+
Residentail plots in phase 4,5 were 130000 to 150000 per marla and now 250000 to 300000.
Phase 7 in sep 2012 was 125000 per marla and now after 4 monts its 155000 per marla
You guys can confirm these rates from market of head office of ghauri town.
So now tell me wich society is giving that kind of money in that short period. Ghauri town is going that good sue to some reason,
- Its rate is cheap then other socities.
- It is near to isb and pindi then all other.
- The society deliver what they say.
- Development is not extar ordinary but equallent to other socities.
- Development is going on very fast (res+ commerical)
- Development of phase 4-c is abt to copmlete and it was launched last year and possesion will start in few weeks (can visit the site and see ur self). No society complets its development in that short period. And there is many more.......
If u visist the society it will speak it self......No need to ask from any body...U can see it with ur own eyes....
I am doing property work since 2004 and i have not seen so much price boost in any society since 2005, earlier it was there till 2004 but now in 2013 ghauri town is performing awesome
In 2011 nov,dec commerical plot was around 450000 to 490000 per marla Now it is 900000 to 100000 per marla (depending on location) Can't confirm commerical plots that easily. Coz no one is ready to sell
In 2011 nov,dec resd plots in phase 4 and 5 was around 150000 to 190000 per marla Now it is around 250000 to 300000 per marla.
In sep 2012 phase 7 plots were 120000 per marla and now its 155000 per marla in just 4 months. Still going up.
You all can confirm from ghauri town head office/ delaers working in ghauri town or any source u have.
So this in one hell of shot to make money. I am doing it and i will adivce u guys also to have a survey and then decide.....
Best regards
None
To expect a monthly income of 25-30 k, you need to have around 5-6 million. A good house of approx 5 marls adjacent post areas nearly cost the same. The rental would be around 25k. You should search areas around dha, cavalry, model town, gulberg, wapda town, and probably bahria as well.
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