Here I will introduce Apartment in Den en chofu ( 田園調布 ), Ota ward, Tokyo, net yield 9 %.
5.6 million yen.
At first I will explain about Den en chofu ( 田園調布 ).
Den en chofu ( 田園調布 ) is one of high-end residential area.
Room number 402
Room area : 13,59 ㎡
Yield rate : 9 %
Current rental fee : 50,000 yen
The seller is very old person.
The realtor is worried about her change of mind. So, this realtor wants to find buyer by cash.
Tokyu Toyoko line, Den en chofu station, 10 minutes walk.
Tokyu Meguro line, Okusawa station 10 minutes walk.
( Express train stops this station. When you see name of station, you need to confirm this point, too. )
Current renter is living in this apartment from 2012, working in IT company.
When renter is company for using its employee, the lease contract will continue for long years.
In case of small apartment, about from 2 to 4 years later, renter will leave the room.
And owner need to find next tenant.
But, when company is renting the room for its employees, even if a employee leaves the room, other employee will live there.
So, your rental business will be stable.
And even if the apartment is far from station, if the room is close to some companies, owner can find renter from employees of the company.
When the apartment is close to station, many investors will be interested in the property and sales price will be high.
But, if the apartment is far from station, some investors will not recognize its good points.
So, you need to check property even if that is far from station.
Because there is possibility that the apartment can find renter from employee of some companies.
Monthly rental fee 50,000 yen – Apartment Management Fee, reserve fund for repair 7,950 yen ＝ 42,050 yen
Built in 1984.
Balcony faces to South East. So, has enough sunshine.
Annual property tax : 17,897 yen
Accumulation of reserve fund for repair : 5,279,192 yen.
( When you purchase an apartment, you need to confirm this point, too. If there is not enough fund to repair, there is possibility that you need to pay extra money to repair building in the future. )
42,050 yen × 12 months ÷ 5,600,000 yen × 100 = 9 %.
The problem in this apartment is that there is not place for laundry machine inside room.
Renter has to put laundry machine in balcony.
In winter, renter has to go to cold balcony.
So, when you check property, you need to check the place for laundry machine.
Of course, the sales price is cheap, you can buy it even if there is not place for laundry machine inside room.
Another problem is that this apartment is equipped with modular bath.
In case of small apartment, this is often the case.
But, some prospective renters will not like this facility and try to find another apartment.
In order to purchase real estate at low price, you need to demand some discount.
When you find suitable property, you can ask discount of sales price.
If the seller wants to sell the property ASAP, there is possibility that she can accept your proposal.
One of my familiar client always demand discount and most of time, seller does not accept his proposal.
Because, his proposal is too severe.
When selling price is 5,000,000 yen, he hopes to purchase it around 4,000,000 yen ( 20 % discount ).