Investment Analysis

A professional property investment requires a sound investment analysis, with a good chart of accounts. The investment analysis produces indicators which enable the investor to optimise return and expenditure. They include:

  • Expenditure
    • Incidental expenses
    • Maintenance costs
    • Extensions by the landlord that add to the general value
    • Administration costs
    • Liability reserves
      • Vacancy rate
      • Refurbishment, renovation and conversion costs
      • Re-letting costs or increase in indebtedness as a result of rent reduction for occupancy during renovation works.
  • Return
    • Assignments or granting of rights to neighbours, possibly in return for accepting advantages to the detriment of the adjoining property and so on
      • Easements
      • Utilisation transfers (utilisation reverse)
    • Inclusion of non-recurring items (e.g. compensation for granting an easement to erect a mobile radio antenna), which could even result in a lower selling price
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