Property Yields Explained: What You Really Earn from Rental Investments
When people talk about property yields, the annual return you earn from renting out a property, usually expressed as a percentage of its value. Also known as rental yield, it’s not just about how much rent you collect—it’s about whether that rent actually pays off after costs, taxes, and vacancies. Many investors focus on the rent number alone, but a $3,000 monthly rent means nothing if the property cost $1.2 million and sits empty two months a year.
Real property yields come from three things: rent, expenses, and timing. A high yield isn’t just about charging more—it’s about keeping costs low and occupancy high. For example, a $400,000 home in a city with strong job growth might bring in $3,200 a month, but if repairs, insurance, and property taxes eat up $1,200, your net yield drops fast. Compare that to a $300,000 unit in the same area with $2,500 rent and only $700 in expenses—that’s a much better return. The best yields aren’t found in luxury towers—they’re often in smaller, well-located units where demand stays steady, no matter the economy.
What drives these yields? rental income, the actual money you collect from tenants after all deductions is the starting point, but it’s cash flow, what’s left after every bill, maintenance, and management fee that keeps you in the game. And then there’s ROI, how your total profit compares to your total investment, including down payment, closing costs, and improvements. A property might have a 6% yield, but if you put 20% down and spent $30,000 on renovations, your ROI could be 12%—or lower, if you overpaid. That’s why smart investors don’t just chase yield—they chase value.
You’ll find posts here that break down what makes a rental profitable in 2025, from short-term lets in busy UK cities to how occupancy rules in Virginia affect your bottom line. Some show how math turns a simple rent figure into a real investment number. Others reveal why a villa isn’t always a better bet than a small apartment. And one even explains why paying a broker in London might save you more than it costs. This isn’t theory—it’s what’s happening now, in real markets, with real numbers.
What is a Good ROI on Commercial Property? Realistic Yields & Insider Tips for 2025
Explore what counts as a good ROI on commercial property in 2025, learn expected yields, compare real numbers, and spot smart strategies for savvy investors.
- August 8 2025
- Archer Hollings
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