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Valuation for apartment

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Andre2000		#1 Posted : Wednesday, February 23, 2022 5:54:30 PM
Rank: New-farer Joined: 9/25/2017 Posts: 15 Location: London UK		Hi Could anyone give an indication of cost for a simple Valuation of a 2 Bed apartment. Also this apartment makes approx 220k per month via Airbnb This would be included in the valuation. Andre
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Jon Jones		#2 Posted : Thursday, February 24, 2022 1:35:47 AM
Rank: Member Joined: 9/11/2015 Posts: 241 Location: Thika		Ignore Airbnb figures. I have a crude way of valuing residential property. Monthly rent (not airbnb) = R Value of apartment = R * 200 *Since men have learned to shoot without missing, I have learned to fly without perching*
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VituVingiSana		#3 Posted : Thursday, February 24, 2022 1:55:30 PM
Rank: Chief Joined: 1/3/2007 Posts: 17,890 Location: Nairobi		Jon Jones wrote: Ignore Airbnb figures. I have a crude way of valuing residential property. Monthly rent (not airbnb) = R Value of apartment = R * 200 Assuming R is net of all costs (net rent) but BEFORE depreciation, taxes, etc then it's a 6% yield which seems the norm. Meanwhile the 19yr T-Bond is paying 13% after taxes though there's no inflation adjustment but the "excess" 7% can be reinvested. Greedy when others are fearful. Very fearful when others are greedy - *to paraphrase Warren Buffett*
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Swenani		#4 Posted : Thursday, February 24, 2022 4:41:42 PM
Rank: User Joined: 8/15/2013 Posts: 13,231 Location: Vacuum		VituVingiSana wrote: Jon Jones wrote: Ignore Airbnb figures. I have a crude way of valuing residential property. Monthly rent (not airbnb) = R Value of apartment = R * 200 Assuming R is net of all costs (net rent) but BEFORE depreciation, taxes, etc then it's a 6% yield which seems the norm. Meanwhile the 19yr T-Bond is paying 13% after taxes though there's no inflation adjustment but the "excess" 7% can be reinvested. Have you factored the capital gains on the property in the 6% calculation? If Obiero did it, Who Am I?
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VituVingiSana		#5 Posted : Friday, February 25, 2022 1:56:21 AM
Rank: Chief Joined: 1/3/2007 Posts: 17,890 Location: Nairobi		Swenani wrote: VituVingiSana wrote: Jon Jones wrote: Ignore Airbnb figures. I have a crude way of valuing residential property. Monthly rent (not airbnb) = R Value of apartment = R * 200 Assuming R is net of all costs (net rent) but BEFORE depreciation, taxes, etc then it's a 6% yield which seems the norm. Meanwhile the 19yr T-Bond is paying 13% after taxes though there's no inflation adjustment but the "excess" 7% can be reinvested. Have you factored the capital gains on the property in the 6% calculation? I know English came by ship but surely you can read "net rent" up there. Since when does rent include capital gains? Greedy when others are fearful. Very fearful when others are greedy - *to paraphrase Warren Buffett*
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Andre2000		#6 Posted : Wednesday, April 06, 2022 12:54:55 AM
Rank: New-farer Joined: 9/25/2017 Posts: 15 Location: London UK		Jon Jones wrote: Ignore Airbnb figures. I have a crude way of valuing residential property. Monthly rent (not airbnb) = R Value of apartment = R * 200 Seems about right!! TA
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My 2 cents		#7 Posted : Thursday, April 07, 2022 7:47:44 PM
Rank: Veteran Joined: 6/2/2010 Posts: 962		Recently sold a flat and this math worked out PERFECTLY. Sale price was 200 times the monthly rent I was getting. (Though the most recent rent factored in a pandemic discount) Sold because am not cut out to be a landlord. Bought shares instead. Dividend on the said shares are 2.5 times the rent I was getting on the flat. All without the hustles involved with being a landlord.
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