LankaPropertyWeb Tools: Learning How to Use the ROI Calculator

The ROI calculator designed by LankaPropertyWeb facilitates users to calculate their return on a property by filtering it based on its location, purchase, price and more. The results of the calculator generate the return for the holding period, the real return adjusted to inflation and the annual return. 

Through the invest section investors can also locate high return properties generated using LankaPropertyWeb’s proprietary algorithm. The algorithm selects the best investment opportunities listed on lankapropertyweb.com and recommends it to users in the ‘top investment properties’ section. This helps investors find the ideal properties to earn maximum returns for their investment without any hassle. With the guidelines and other information also included in the website, an investor can make better informed decisions on a property of their choice. 

Steps to follow when using the ROI calculator 

The percentage of return a real estate investor can gain after deducting the related expenses of the investment is called the real return. It comprises two elements. The first one is the capital gain which is the value appreciation of the property during the holding period or the price you will sell the property for and the other is the income generated during the period (rent income). 

To calculate the ROI, deduct the expenses you have incurred during the holding period such as insurance premiums, management fee, interest paid (if the property was bought on a bank loan) etc. 

Using the LankaPropertyWeb ROI Calculator designed especially for this you can find your returns faster and easily.

Hypothetical scenario

Mr. Perera is an individual buying a house in Colombo for Rs.25Mn using his savings worth Rs.12.5Mn. The balance is expected to be sourced from his bank using a housing loan with an interest of 7%.

To cover his loan repayment he rented out the property for Rs.150,000 a month and included a clause to increase the rent annually by 3% in the agreement.

Mr.Perera had to pay the apartment management fee of Rs.15,000 monthly which increased by 5% every year.

At the end of the loan repayment period, Mr. Perera decided to sell his investment asset to realize his gains.

The annual value appreciation for the apartment is 5% per annum and Mr. Perera has to pay 3% as the realtor fee on successful completion of the transaction.

According to the details he entered into the ROI calculator he realized that he had made a 109.88% return on his investment.

The invest section on the LankaPropertyWeb portal also aims to become a platform to diversify the property investments within Sri Lanka by providing foreign investors with specific information on Sri Lankan property. With the recent budget proposal allowing non-resident Sri Lankans to purchase luxury condominiums and investors to purchase property through the Sri Lanka Real Estate Investment Fund (SLREIT) to enjoy various investment benefits, information required on the process is freely available as well on this page. 

By investing in real estate at a time where the pandemic has resulted in many developers offering discounts and offers, investors can certainly earn the best returns now.