Brand New vs. Used

Merit of Brand New

Brand new equipment installed
Easy to get a tenant 
Possible to set rent high due to premium value
Needs no repairs
 

Demerit of Brand New

Expensive price = Low return 
Loan interest and other costs occur during uncollected rent period until property is completed
High necessity to bring rent down for the second time tenant to a room
Need to collect tenants from scratch

Merit of Used

Inexpensive price = High return
Possible to get rental income right off the bat if there are tenants
Possible to purchase after confirmation of a building
Possible to save on tax because of many depreciation costs per year 

Demerit of Used

Harder to get a bank loan than brand new
Difficult to get tenants and to maintain the building 
Needs repairs

Summary

If you don’t want to spend too much time and work, a brand new building is a way to go.
High yield used properties are recommended to those who focus on monthly income gain.
To those who focus on capital gain, used properties are also recommended since the price is cheaper.


Brand New vs. Used
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