what comprises "a good investment"?

**enthusiast.** · 12-21-2009, 01:57 PM

I have my opinions on this, but I was wondering what other people thought makes an investment worthwhile. Does it make money, stay even, or even lose money? For example, I recently acquired an investment property appraised at $592,000 for $570,000. I purchased it through the bank in an approved short-sale. Escrow closed Friday. The 30-year mortgage should be about $2500.00 p/m and I should be able to get a renter at $2200.00 p/m. In this way, excluding taxes, I would take a loss of -$300.00 per month. Would you consider this a good investment, even when I am at a loss every month? Although I personally find this investment good in the long run, I consider the perfect example of a good investment in another property I purchased almost 15 years ago. The mortgage per month is a little less than the rent, but the extra money is used to make improvements on the house and handle taxes and any other expenses that come with the property. In this case, I would label the invest as good, even though per month is even and I am not necessarily "making money."

**tiamonra** · 12-23-2009, 12:37 AM

Hi,

I am a property agent based in Istanbul Turkey and wanted to ask why the rental return is so low up there ?? Your return comes to 4.6% per annum(26.000usd) over the purchase price.

I really shocked because foreign investors are making at least 10% profit over rental return for residential units in Istanbul. For example 1 bed property (45.000euro purchase price) brings at least 380 euro per month which comes to apprx 4600 euro for year ( means 10%)

Commercials are much more valuable. For example, I have an old building now consisting of 6 studio units. The purchase price including keyready renovation is 450.000 Euro and brings 72.000 euro rental income from 6 units. It means 16% rental profit !

You should think to invest overseas. British are making much money by following by investing countries like Turkey..

You can write me if you are interested in such profitable deals.

Best Regards

Melih

ASM PROPERTY INVESTMENT

**enthusiast.** · 12-23-2009, 02:09 PM

Originally Posted by tiamonra

Hi,

I am a property agent based in Istanbul Turkey and wanted to ask why the rental return is so low up there ?? Your return comes to 4.6% per annum(26.000usd) over the purchase price.

I really shocked because foreign investors are making at least 10% profit over rental return for residential units in Istanbul. For example 1 bed property (45.000euro purchase price) brings at least 380 euro per month which comes to apprx 4600 euro for year ( means 10%)

Commercials are much more valuable. For example, I have an old building now consisting of 6 studio units. The purchase price including keyready renovation is 450.000 Euro and brings 72.000 euro rental income from 6 units. It means 16% rental profit !

You should think to invest overseas. British are making much money by following by investing countries like Turkey..

You can write me if you are interested in such profitable deals.

Best Regards

Melih

ASM PROPERTY INVESTMENT

Yes, the rental return where I live is pretty low. However, since the market then purchase prices fell, the annual return on investments like mine have increased! Which is pretty ridiculous since it is still so low when compared internationally. Most people are searching for smaller living space (2br/1ba), so the return annually is higher in those investments.

I guess in Turkey things are much different. It would be ridiculous if you were able to get a 10% return on something similar here.

16% return?????!!!!! That must be amazing. How are taxes there? You must have something incredible because if taxes are negligible, you coul be able to completely pay off your purchase in >6 years? Depending on the down, vacancies, and etc.

I don't think I'm ready to invest internationally, but perhaps you could send me a few sites or even just listings? Even if I'm not purchasing something immediately, I'd like to know what is available anyways.

Thanks!

**tiamonra** · 12-23-2009, 04:38 PM

Originally Posted by enthusiast.

Yes, the rental return where I live is pretty low. However, since the market then purchase prices fell, the annual return on investments like mine have increased! Which is pretty ridiculous since it is still so low when compared internationally. Most people are searching for smaller living space (2br/1ba), so the return annually is higher in those investments.

I guess in Turkey things are much different. It would be ridiculous if you were able to get a 10% return on something similar here.

16% return?????!!!!! That must be amazing. How are taxes there? You must have something incredible because if taxes are negligible, you coul be able to completely pay off your purchase in >6 years? Depending on the down, vacancies, and etc.

I don't think I'm ready to invest internationally, but perhaps you could send me a few sites or even just listings? Even if I'm not purchasing something immediately, I'd like to know what is available anyways.

Thanks!

Thanks for reply...

I really do not understand why the rental is still so low although the prices up there fell down

It must be vice versa.

Taxes are very low in Turkey as the country has foreign direct investment law as an incentive to attract more foreign investors. There is a monetary law now that the Turkish government do not even ask where the money come from and why for a certain time period

The purchase tax is max 4% in Turkey. As a good comparable, it is around 10% in other european countries.

The rental tax is very easy depending on self declaration! It means that you pay tax once you declare it to the government

its not checked at all by government unless you declare as its accepted as personal use for owner. It is around 15% as gain tax over the total turnover of rental income per annum once you declare. For instance, if you are earning 10.000usd, you only have to pay 1500usd to government on yearly basis. Thats all!

This is also interesting that the rental contracts with tenants are drawn up for min. 1 year (so there is no vacancy risk at all) and the properties are rent in a month time easily as there is huge rental demand in Istanbul. The city gets 400.000 new inhabitants every year because it is the heart of education and business in Turkey. So the housing supply stays behind the demand. Thats very valuable information... So you can now understand why the rental return is awesome.

You can check some portfolio from asmpropertyinvestment.com . Its our website.

We are usually working with american and european investors who are looking for this kind of profitable deals. Every property agent can not generate these deals as you have to be professional and special skills of bargain with property owners on our clients' behalf.

If you need, I can give you further information how the process works and available deals matching any budget range.

**Arizona Cash Buyer** · 12-28-2009, 05:09 PM

No, Its not a good Investment.

How many of those can you take on a loss is a loss

There are so many properties on the market that you can buy undermarket and still cash flow, I would NEVER touch a property like that.

If you positive cash flow now(wich you really should) it will only be better when the market gets better.

Speculative investing is what caused the entire housing bubble and should be avoided at all cost.

**Land2sand** · 12-29-2009, 01:34 PM

If you take a loss of 3600 a year on an investment then it's a bad investment for you... financially.

Since your nut is leveraged completely on a tentant's ability to pay rent then you have overleveraged your risk and the odds are against you. You can get lucky and get a great tenant in the home but with unemployment rising and home values still going low, you def. have your work cut out for you. Good luck

**JohnDavis** · 01-02-2010, 09:10 AM

Yup, not a good investment. Of course rent rates will eventually rise to meet and then exceed your monthly expenses, but that will take years, and the problem is that you need the rent to greatly exceed it. Just because a property is a few hundred dollars positive after paying the mortgage doesn't make it profitable.

There are a couple of ways to determine a good rental investment, but one is the 50% rule (40% if you do your own management): as a general rule, long-term maintenance costs (including vacancies, property management, and major expenses like flooring and roof) run about 40-50% of rental income, not counting the PITI. That means a property that rents for $2,2000 should have a PITI payment of no more than about $1,300/month. It's also generally harder to find (and rent) properties at those higher rent rates - you're better off with rents closer to $1,200 - $1,500, which would put your PITI at $700-$900. Those are common in some areas.

**taxlienadvisor** · 01-06-2010, 01:20 AM

Hello,

I would like to be of assistance to you and help you with your question. I like to think that any investment that makes a profit or produces consistent and constant cash flow is a good investment.

The one that you described sounds like it will not pay off for some time.

I think you may want to consider the Tax Lien & Deed business. It is the safest and most lucrative investment in America today that I know of.

I just completed a 10 page report last week entitled "7 Steps to Investing in Tax Liens & Tax Deeds." ... If you would like me to send you the report, just send me a private message with your email address and I will forward you my report.

I hope this helps. Good Luck. I would like to wish you the absolute best in all of your future Real Estate Deals and Ventures.

**cleondann** · 01-08-2010, 04:47 AM

I think it really depend upon he recommended the realtors are and wat type of loan u have applied.

regards
cleon dann

**bangkokofficespace** · 01-11-2010, 10:02 PM

I think it is not a good investment,as you have said,you have a loss every month. Well,it is not good for an investor,a loss is still a loss but a profit is still a profit,get new ways on how to improve the property and maybe,you can raise fee to avoid the loss.