Ok, I’m a bit deficient in math skills, but I’m fairly sure there’s an answer for what I’m looking for. How do I calculate the most efficient property for me to buy? I want to make as much money as possible as quickly as possible. Am I looking for something other than efficient? Maybe just aggressive?
NY properties have a static hourly income (i.e Valu-Mart at $10,000 per hour and Mega Casinos at $3,000,000 per hour). The costs for these, as well as the land they’re built on, increase at what I believe to be a uniform rate. I have been comparing costs to hourly income to determine relative value, but the hourly rate is being neglected in my calculations.
A 5 Star hotel costs me $874,000,000 and earns $200,000 per hour, 874,000,000/200,000 = 4370
A Mega Casino costs me $1,558,000,000 and earns $300,000 per hour 1,558,000,000/300,000 = 5193
This tells me that for one hour, the 5 Star is a better value, but I’m pretty sure that over time the initial cost will be offset by the long term gains if I buy the Mega Casino. I was trying to weight my final numbers (in this case 4370 and 5193) by a common factor but that’s when the numbers started diverging at an unbelievable rate.
4370/2 = 2185 5193/3 = 1731
Given this scale it seems that I might be always better off buying the higher yielding Mega casino, but the costs increase for every property bought.
Is there a formula I can use? Because this is a bit beyond my simple mathematic comprehension.