Is 10% a good return for a rental guarantee concept?

Mar 2, 2017 | Emerging Trends

It may sound like an obvious question, but what is a ‘good’ return in today’s modern market? To answer this question, you only need to look at the interest rates and therefore the returns that are being offered by the banks.

The returns offered by banks are generally in the region of 1-2% which is below the rate of inflation in most developed countries – to put this into perspective, if your return doesn’t exceed inflation you are LOSING money in real terms.

The problem is that to get a better return you need to take more risk – a word that is frowned upon and avoided wherever possible by most investors. Stocks and shares are likely to gain you a good return but the risk is perceived to be high and there is always a danger that you could lose some or all your capital – even if you invest in traditional blue-chip companies. Property and gold are probably the safest options but the returns can vary.

Is 10% a good return for a rental guarantee concept?

 

When it comes to property there is a good chance that your return will exceed inflation. However, the old adage of ‘location, location, location’ is very true and this can force up prices therefore reducing returns. Another problem more commonly associated with investment properties is tenants. Firstly, finding them in the first place and secondly, finding tenants who will stay long-term, pay their rent on time and look after your property. Achieving this can be a major headache and is the reason that many either avoid this type of investment altogether or pay a management company.

Management companies have some very obvious advantages, certainly when it comes to stress reduction. However, the downside is that they will charge a monthly fee that will eat into your return. Couple this with the fact that there is no actual guarantee that they will be successful in finding tenants and not only that, good tenants so you may be no better off than you were if you tried to do it yourself but pay for the pleasure of someone else failing.

It is maybe for this reason that rental guarantee concepts are becoming increasingly attractive. A rental guarantee is exactly that – a guarantee and in most cases, they manage your property on your behalf. You will know what return to expect and over how long you will receive it even before you purchase the property, making any investment decisions far easier. Returns vary a great deal but it is seen as a safe investment. Returns of high single digits should satisfy most investors.

A great investment then is the New Nordic rental guarantee concept. The New Nordic Group are based in Pattaya, Thailand. Their scheme offers returns of 10% p.a. rental guarantee for periods of anything from five to twenty years. This deal has been in place for around a decade and has proved to be very successful for all parties with many existing investors looking to purchase more units. The experienced management team and sound business model means that such as scheme can be trusted as the company has such a well-established track record.

A 10% p.a. return is therefore a great for a rental guarantee concept and indeed the offer from the New Nordic is something that any investor should consider.

Investments Backed by one of South East Asia's BIGGEST Holiday Resorts

Don't Miss Out!, Entry Level Investments start from as little as $5000 and returning 15%+ R.O.I.

Discover Why a Change in Tourism is Great for Thailand’s Economy

Thailand is currently experiencing a change, meaning today we see a completely different view when it come to the Kingdom's tourist industry. Over the years, the visitors to the country came from the UK and other European nations but times have changed, mainly due to...

Thailands GDP Is ‘Rock Solid’ thanks to its Diverse Economy!

Thailand's GDP is rock solid, and has a diverse economy compared to many other countries around the world. If you take the Middle East or Russia, their economies are based on one item – oil. if the price of oil drops, it has a huge impact on their economy. Thailand’s...

A ‘New’ Pooled Investment Fund

The New Nordic Group is one of the leading property developers in Pattaya and indeed they have been so successful that they can now be found in other areas of Thailand and Asia. The company has an impressive track record for offering the 10% rental guarantee concept...

Share This

Share this post with your friends!