I am about to put an offer on a commercial property.
they want 485,000 for it it is 3 businesses one is a pinkys pizza one is a thai cafe and the other is a doctors surgery.
They are giving an income of 42000 per annum,
i think this is a good deal every thing works out.
working on current interest rates of 6.5% i should make around 10,500 per annum.
Any sugestions, apart from my spelling.
Thanks.Are you looking for +CF or CG?
Whats a +CF or CG?
+CF – positive cashflow
CG – Capital Gain$42,000 gross income per annum is only an 8.7% return (approx). Many people would probably find this too low a return for the risk of commercial property.
Who took my MONEY[?]
For a commercial deal the banks will only lend 60 -70% LVR, and also commercial rates ar slightly higher, around 7 – 8%.
I think the returns on this deal seem to be too low.I would do some more research before signing.
Crusader1
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