a) To find the amount of interest Sasha needs to pay back every month, first find the yearly interest by multiplying the loan amount by the interest rate: $300,000 * 0.07 = $21,000. Then, divide the yearly interest by 12 months: $21,000 / 12 = $1,750 per month.
b) To find Sasha's yearly income from rent, multiply the monthly rent by 12: $1,500 * 12 = $18,000.
c) To calculate Sasha's overall loss in a year, first add the yearly cost of interest and other costs: $21,000 + $3,000 = $24,000. Then, subtract Sasha's yearly income from rent: $24,000 - $18,000 = $6,000 loss.
d) To find the percentage the property needs to increase in value per year, divide the yearly loss by the original price and multiply by 100: ($6,000 / $300,000) * 100 = 2%. The property needs to increase in value by 2% each year to cover Sasha's losses.
Sasha buys an investment property for $300,000 and borrows the full amount at 7% p.a.(per annum) simple interest. she rents out the property at $1500 per month and pays $3000 per year in rates and other costs to keep the property.
a) find the amount of interest Sasha needs to pay back every month
b) find Sasha's yearly income from rent
c) by considering the other costs in keeping the property, calculate Sasha's overall loss in a year.
d) Sasha hopes that the property's value will increase enough to cover any loss she is making. by what percentage of the original price will the property need to increase in value per year
1 answer
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