By and large, when it comes to investments in real estate, the one thing that happens to be as important to know of is your rental yield. It doesn’t matter whether you are a seasoned investor with a collection of rental properties under your name or just starting out in the field of real estate investment, the need to determine your rental returns is one thing that you never should overlook for as long as you are in the business of property investment.
In this post, we will be seeing some of the basics that as an investor in real estate you need to know of in so far as rental yield goes, what it is and how you can accurately calculate your rental yield. Check this guide out to learn as much as you can when it comes to real estate investment, particularly on determining rental yield.
Talking of what rental yield is, this can be generally said to be what returns they are that an investor in property is likely to generate on their property HDB for rent. To help understand it better, it is to be seen and understood that it is generally a rate or percentage figure and is a derived from dividing the annual rental income that is earned from the property by the total amount that was invested in the whole property.
Like we have already mentioned, when making an investment in property, it is more than important for you to understand what rental yield the property has and basically ensure that you are getting a 2 room flat rental yield at the end of the day. You see the reason for this when you factor the bit that in the event that you so happen to have invested in a property that gets you earnings that are way below your expenditures, then the property will be doing you nothing but earning you losses at the end of the day. As well, it is to be known that in the event that you happen to have made an investment in such a property that simply earns you enough to cover the total costs, that is the variable and the fixed costs, then you will as well not be making any money but sitting pretty at break evens. Needless to mention the fact that where you so happen to be earning just enough not to cover the contingencies, then it so follows that in the event of an emergency like a broken boiler, then you will be well in danger with your investment in property.
This as such points to the fact that when it comes to making an investment in property, you need to mark the need for you to ensure long term sustainability.
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