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Let's make an easy example. # n0 s. t" d* |
. ?1 Q. `0 u m1 a. T5 A3 nSuppose one person bought a house worth 100,000 last year. It's a two bedroom style.3 b8 d; C, m3 C
After one year, he or she decided to sell it out. ' \# j# _4 A2 X( E, r$ q- a& u
- G2 N7 O' S9 U7 ICost (expense):
" J4 S6 h& K5 q. FBusiness tax: 5%*100,000=5000 (please verify)
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Mortgage interest: 5%*100,000=5000 (not only the loan interest you pay the bank, but the interest of inital payment of house should also be accrued)
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Estate agent fee: 1%*100,000=1000 (this part is neglected in previous statement)
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Real estate management fee: 250*12=3000
! {; Y! C; d7 N9 T2 ~6 k8 Z5 t3 ]Total cost: 14000
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Benefit:' Y, J& f/ o4 `; g% r
The saved rental: 350*12=4200
6 [) R4 [0 T$ r# W* jThe rental income from tenant: 350*12=4200+ i4 U- R$ k: |% B d9 q
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Value increase: 100,000*6%=6000
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0 t* E; H. w. O; ~# i1 rTotal benefits: 144009 H6 g1 z8 z( m2 f
So if both purchasing and selling transactions are conducted in one year, just slight gain could be achived. So the edmonton estate market is not worthwhile for short term investment
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) \6 b3 @, z5 M y' N' Q( n, z- _[ Last edited by knptmug on 2005-3-8 at 07:45 PM ] |
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