Question :
Find out the premium have to paid by the tenant using the investment method
market monthly rental : RM 12,500
paid rent : RM 10,500
tenancy : 5 year
freehold rate risk yield : 10%
leasehold rate risk yield : 11%
asf : 3%
Landlord Perspective
|
Tenant Perspective
|
Student have to find out the for
landlord perspective
1) Loss Rent
2) Present Value
3) Year Purchase Value
4) Capital Value
|
Student have to find out the for
tenant perspective
1) Profit Rent
2) Annual Sinking Fund
3) Year Purchase Dual Value
4) Capital Value
|
1) Profit Rent
find out Profit Rent formula is Market Rent - Paid Rent = RM 150k - RM 126k = RM 24k
2) Present Value
find out PV Present Value
using the formula 1 / (1+i )^n
PV = 1 / ( 1 + 0.10 ) ^21
= 1
/ ( 1.10 ) ^21
= 1
/ 7.4002
=0.1351
3) Year Purchase
find out the YP Year Purchase
using the formula (1 - 0.1351) / i
YP = (1 - 0.6499 ) / 0.10
=
0.8647 / 0.10
=
8.6477
4) Capital Value
find out the capital value using
formula YP x Profit Rent
Capital Value = 3.8895 x RM 24k
= RM207,568
|
1) Profit Rent
find out Loss Rent formula is Market Rent - Paid Rent = RM 150k - RM 126k = RM 24k
2) Annual Sinking Fund
find out ASF Annual Sinking Fund
using the formula i / [ (1+i )^n - 1 ]
ASF = i / [ (1+i )^n - 1 ]
= 0.03**
/ [ (1 + 0.03 )^21 -1]
= 0.03 /
[1.86029 -1 ]
= 0.03 / 0.86029
= 0.03487
3) Year Purchase Dual Value
find out the YP Year Purchase Dual
Value using the formula 1 / [ i + asf ]
YP =1 / [ 0.11* + 0.0387 ]
= 1 /
0.14487
=
6.9027
4) Capital Value
find out the capital value using
formula YP x Profit Rent
Capital Value = 6.9027 x RM 24k
= RM165,666
* remunerative - expectation return
** accumulative - something you save |
Premium To Be Paid
= Average The Final Offer
= [RM 207,568 + RM 165,666] / 2
= RM 373,234 / 2
= RM 186,617
