Anyone who wants to buy real estate for renting or who intends to rent vacant accommodation must carry out preliminary calculations. The objective is that this operation can at least be self-financing thanks to the rents collected, before ensuring additional income. But for lack of having prepared enough for his blow, personal finances could suffer.
A succession of equations
To get a first idea of the profitability of a rental investment, you must multiply by 100 the amount of the annual rent that you plan to pocket (taking into account the local market for this type of service), before dividing it by the price purchase, acquisition costs included. This gives you a gross return. However, this figure is largely overestimated since this investment will entail many expenses.
In order to have a vision closer to reality, you must redo your calculation by deducting from the annual rent all non-recoverable costs, such as condominium fees, property tax, property insurance, management fees, etc. This is called the net rental yield. But beware, this investment can also have an impact on your income tax. To avoid unpleasant surprises, it is necessary to calculate the net-net return of any tax that depends on the tax regime of the rental, your taxable bracket and any tax deductions you may benefit from.
Anil helps you
Calculating the return on a rental investment is therefore no easy task. To rough the terrain, you can use the new online simulator made available by the National Agency for Housing Information (Anil). This tool allows you to simulate the income and taxation of your project, taking into account the amount of the acquisition, the surface of the property, the tax regime chosen (bare or furnished rental), the amount of rent, charges and your personal tax situation.
Faced with such a substantial financial investment, it is recommended that you also contact a specialist, such as a notary who has been following you for a long time, a credit broker who has been recommended to you or a banker who has already demonstrated all its competence.