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Lahore Real Estate Forum: Property News & Community Talk : ,

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   Haroon_16®
Monday, September 26, 2016 01:15 PM 
Reply: >
Is it a good idea to buy corolla and rent it out for monthly rent?

Is it better business than renting a house out?

If yes, how much profits estimated?

Which companies to give car to? Are they reliable?
Navid replied on Monday, September 26, 2016 01:29 PM 

Start Uber business....hire a driver for it.

Quite Lucrative!!!!
Navid replied on Monday, September 26, 2016 02:00 PM 

Go for two 660 cc Japanese cars .....spending 18-20 lac. Estimated return will be 1 lac per month per car !
Navid replied on Monday, September 26, 2016 02:07 PM 

A car, on average, remains in operation for 10 hours a day....
In each hour, let's say there are two rides each @350 rupees. It means, 350x2x10=7000 rupees....
Out of 7000 rupees, 4000 are the expenses(uber share, driver, fuel, maintenace), it means 3000 per day is the profit.
Haroon_16® replied on Monday, September 26, 2016 02:20 PM 

Thanks so much Navid bhai. So I need to give car to Uber. Can you please tell me how do I contact Uber and ask them to take my car? Do they hire their own drivers or do I provide Uber with driver and car both?
Khurram® replied on Monday, September 26, 2016 02:32 PM 

Navid, these calculation seem confusing to me. If there were two rides, it means we did the business of 700 rupees only for that day. From where did this 7000 come in? Does it will mean uber will pay you from their pocked since the car was available for 10 hours of the day ? If so, does not make sense. Can you please explain?
Haroon_16® replied on Monday, September 26, 2016 03:00 PM 

Kharrum, he said 2 rides per hour, not day. Read his comment again.
AHMAD HASSAN® replied on Monday, September 26, 2016 03:01 PM 

Buy Mercedes only & rent out for weddings. Easy to manage & low risk as well.
Khurram® replied on Monday, September 26, 2016 03:20 PM 

Got it though 2 rides every hour and each costing Rs. 350 seems difficult but this makes the calculation correct.
Salman.A® replied on Monday, September 26, 2016 03:24 PM 

UBER or CAREEM are not lucrative business models for full time earnings. UBER is useful when you own your own car and want to share your monthly car expense. If someone goes to office in the morning , he can pick a ride and when he comes back he can pick a ride again. This way his monthly expenses of petrol etc will be covered. This is what uber is for.

UBER is not the main business at all in fact it is one of the worst. I will not go into details i will just give break down the profit calculation posted by mr Navid. I am assuming 2 rides per hour, even though it is highly impossible that you pick and drop 2 rides in one hour in LAHORE. but lets assume same constant as mr navid.

7000 per day Gross Earnings
1750(25%) UBER SHARE ----- = 5250

Rs. 350 Ride means 20 KM approx. i will assume minimum 6.5 Rs. per km petrol expense. For 40 km in 1 hour means 40*6.5=260 * 10 = 2600 Petrol Expense for whole day with 400KM Rides.

= 2650 Rs. Left

Drivers PAY 20000/Month which will translate into Rs. 770 per day ( driver will work for 26 days with sundays off ) and do not expect to get a literate driver for any less.

= 1880

Now with car travelling for 400KM everyday it requires 3 oil changes at 3000KM each. Each oil change cost approx 1800*3=Rs.5400/Month. which is Rs. 208 per day

= 1672

Now we come to maintenance . Tuning will be required at least monthly + car service + car wash + polish + etc etc and i will roughly calculate that to be Rs.7200/month or 277/Day

1672-277=1395

Now lets come to TIRES , average 50,000 KM for tires , which will take 5 months to change Tires cost about 25000 to change. So we will have cost of 5000/month or approx 200/Day

1395-200 = 1195

Now Last but not the least the car is depreciating and car with high milage will depreciate more
Depreciation is taken at 10% per annum ( which means 8333/Month depreciation or 320/DAY

1195-320 = Rs.875 Per day profit

I have done my best to be as low as possible or cost. I am sure the cost will be much higher for example car accident ? car stolen ? major accident ? total damage ? now if you want insurance then it will cost 3% per annum of the total cost of the car.


I will not get into insurance and calculate 875 as daily profits. Which turns out to be approx. 22500/MONTH.

its not that lucrative. and in real life when the car is on the road it will be far far less. Especially when you will goto the market to sell the car, all your profits will be washed out in depreciation.

In the End UBER is good for sharing your car expense not to run your kitchen. Unless you yourself drive the car then money can be made for monthly house expenses.


I have tried my best to explain in little more details about the expenses of driving a car on the road. Rest all of you are smarter than me. Make your own decision

( If there are any calculation mistakes please forgive me , this is not an exam it is just to show a real picture )
Haroon_16® replied on Monday, September 26, 2016 03:48 PM 

Ahmed sir, I am not that rich. Not even close. Salman bhai thanks so much for the effort you put in. Right or not, I appreciate your effort and also your points make sense. So taking Uber or Careem out of the equation, do you think I should give a car to any multinational company or those who run rent a car business? Any advice in that please? And if you have more options, please do share those as well regarding renting my car out business. Thanks.
Waseem® replied on Monday, September 26, 2016 04:44 PM 

Looks like property business had a real bad hit after all. We are discussing auto business on real estate website. SMH
Pakistan® replied on Monday, September 26, 2016 05:50 PM 

just watch tonight Kamran Khan program on Dunya news abt property business

it has collapsed
Navid replied on Monday, September 26, 2016 06:33 PM 

@ Salman A: I'm sorry....ONE BIG MISTAKE IN CALCULATION:

UBER CHARGES 350 FOR A DISTANCE OF approximately 13-14 Km (not for 20km) as follows:

base fare:150, per km charges: 6.84, per minute charges: 3.15

So if a ride of 13 km takes 25 minutes in Lahore, the charges would be calculated as: 150+ 6.84*13+ 3.15*25 = 350

Moreover, many a times, the surge of 1.2-2.0 is applied to the fares, making 350*1.5=500.

NOW DO YOUR CALCULATIONS.

BTW, EVEN AUTO RICKSHAW CHARGES 300 rupees for covering a distance of 10-12 km in Lahore, then how you are supposing that UBER will charge 350 for a distance of 20km????
Navid replied on Monday, September 26, 2016 07:08 PM 

I am assuming 2 rides per hour, each of 12km distance which is QUITE POSSIBLE( rikshaw charges 300 for a distance of 12km and UBER is a much better alternative and won't remain free at all).

7000 per day Gross Earnings
1400(20%) UBER SHARE ----- = 5600 : RIGHT NOW UBER SHARE IN PAKISTAN IS 20% not 25%.

Rs 350 ride means 12 km approx. So assume 6.5 Rs. per km petrol expense, for 25 km in 1 hour means 25*6.5=162*10-1600 petrol expense for whole day with 250 km rides.

= 4000 left

Drivers PAY 20000/Month which will translate into Rs. 770 per day
= 3230 left

Now with car travelling for 250KM everyday it requires 2 oil changes at KM each. Each oil change cost approx 1800*2=Rs.3600/Month. which is Rs. 105 per day

= 3125

Now we come to maintenance . Tuning will be required at least monthly + car service + car wash + polish + etc etc and i will roughly calculate that to be Rs.4000/month or 125/Day

3125-125=3000

Now lets come to TIRES , average 50,000 KM for tires , which will take 8 months to change Tires cost about 20000 to change. So we will have cost of 2500/month or approx 100/Day: This will be covered by ONE SURGE FARE PER DAY ON AVERAGE !!!


INSURANCE, DEPRECIATION etc: 15% of total i.e 500 Rs. per day
3000-500 = Rs.2500 Per day profit.
SO PROFIT PER MONTH= 2500*30=75000! THE SURGE FARES ARE EVEN HIGHER IN UBER, GIVING ONE THE OPPORTUNITY TO EARN MORE IN PEAK HOURS.

OK, even after considering the ground realities, let's say one earns 50k instead of 75k, it becomes a win win situation by investment of 1 million rupees car !

So by investing two cars of worth 2 million, one can earn at least at least 1 lac rupees per month by UBER according to my calculations!


(Thanks Salman A for providing the detailed scenario to be discussed...)
AHMAD HASSAN® replied on Monday, September 26, 2016 09:00 PM 

2005 E series will cost you 2.5m & 2016 corolla 2m. Difference is less but profit is high. Don't own risks. جس کا کام اسی کو ساجھے
Aarif replied on Tuesday, September 27, 2016 04:23 AM 

There is often shortage of cars (both on careem and uber). Careem is not even able to cover 20% of lahore with its current supply of cars.

Whereas in Uber (because of cars shortage), customers often pay on surge pricing (means paying 1.5-2 times of regular pricing).

So following can be concluded from above..

- There is great demand of this uber, careem alike services in lahore market. Where as the supply is very low. Because of that prices (and yield) is higher as compared to regular pricing.
+3163 replied on Tuesday, September 27, 2016 10:56 AM 

Can anyone guide me whom to contact for wedding services or hotel services. I need to rent my car to earn some extra bucks.
User_19767® replied on Tuesday, September 27, 2016 10:56 AM 

Can anyone guide me whom to contact for wedding services or hotel services. I need to rent my car to earn some extra bucks.
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