2 bed semi Durham numbers

Pretty much every other property (except for the Stan Laurel one) since I joined has had higher projected returns, the HMOs etc significantly so, so maybe everyone's put all their pennies in those or are holding out for more properties with better projections.

The two current properties are taking what seems an age to fill.  Is it the properties or lack of funds from investors?

Are PM committed to purchase or do they have a timed option?  

At least those who have gone in are getting 3%, but is this sustainable?

Hey everyone,

I created a little sheet on google drive to calculate the predicted return for the investments.
It uses the numbers PM gives and turns them into interest p.a. (the green boxes).

docs.google.com/spreadsheets/d/1PZbvNuPprgmNl-XVYwgYxAWk7Dv8852FmKNyCDz904A/edit?usp=sharing

I filled it out for some of the older opportunities and for the "2 bed semi Durham" at the bottom.
You should be able to copy the whole sheet and enter your own numbers if you want to. I am also happy to implement changes if you have any requests.
The grey fields are the ones that need to be filled out. The rest calculates itself.
The actual internal rate of return should be a bit higher because the rents are paid during the year and not at the end of it, as my calculator assumes.
But I ignore that fact out of three reasons:

• it would make the table quite large to enter every single month
  
• the difference in interest it makes in the end is quite low
  (around 0.3%)
  
• I wouldn't reinvest the rents immediately anyway but wait for them to accumulate for a while 

Let me know what you think.

Oldboy

Thank you for the feedback, optionstrader.
The 15% fees are there. I just labeled them incorrectly as "PM-Fees 5%". I now corrected it to "PM-Fees 15%". The calculation has already been correct with 15%.
The formula I use for the PM fees is: ((price on sale) - (acqusition cost) - (sales costs)) * 15%
So in our case: (67.898 - 58.000 - 2869) * 15% = 1054

I wonder about the acquisition cost. You used numbers from the sheet PM gives, which sum up to 57.650 pounds. But they collect 58.000 pounds. What happens to the 350 pounds that are being collected unnecessarily? Does anybody know?

You added correctly. I get the same result.
Maybe they return the unused amount with the first payment or they keep it in the provision fund.

You can now enter the percentage of the rents that you want to subtract for repairs. The field is on the right side of the tables above the interest.
If you don't want to consider possible repairs, just enter 0%.

Hi all

Firstly, I love the spreadsheet Oldboy. Really great stuff and I'm sure people will find it useful. We have thought about include IRR on the site and it's something that we may look at in the future.

Hopefully, I can help to answer your question too. As each share is £500, we round up the total required to the nearest £500. This money is then held in the SPV's account to be used for any rental costs. Any surplus at the end of the term (which there usually will be due to us retaining a flat 20% corporation tax without any allowances being accounted for) will be returned to investors. 

In relation to the speed of funding on the current two properties, they are proving a bit slower than the previous properties but I think a lot of people are away and it is the typical summer slowdown. We do see the funding level ebb and flow but hopefully everyone will get behind these properties when we pay out the rent on Friday.

We usually have properties secured for around 3 months so no issues there and the 3% annual bonus is, of course, being accrued. 

Kind regards

Andrew

Hi Oldboy

Your calc looks right to me as we would use the total fund amount to work out the net numbers. Hope that helps but do let me know if you need anything else. You can also email us at support@... or me on andrew@....

kind regards

Andrew