Comparing property prices between different cities
Comparing property prices between different cities. When comparing property prices between two cities , whether these two cities are in the same country or in different ones, most people think only in terms of prices. This can turn out to be a huge investment mistake that will end up with losses or at least with missed other better investment opportunities. In fact, when looking at the returns you make in an investment, you should not only take into consideration the return you obtained from this investment but also take into consideration the returns that you could have made by doing other investments instead. To illustrate this, let s take a concrete example. Let s consider an investor who has bought a house in Hanoi, Vietnam. Let also assume that his or her goal was to rent this place. Five years after having bought the place it is time for the investor to look at the returns he or she have made since the initial investment and determinate if this has been a good or bad investment. So first thing first, calculating the returns realized. This is not an easy task. In order to do so, you will need a couple of intermediaries calculations. You will need to evaluate the current price of your property, if this price is higher than the price paid for the property you will need to know how much taxes you will have to pay if were selling your property now in order to determinate what would have been your net profit. You will also need to sum all the expenses you have had since the purchase. That s a tricky exercise where many people fail to account for all costs. - your income (rent) - take into consideration how mortgage impact your overall returns.