Real Estate InvestingHomebuying Glossary
Rental Yield
The annual rental income a property generates, shown as a percentage of its value.
In plain English
Rental yield divides a property's annual rental income by its value or purchase price, giving a quick sense of how much income it generates relative to its cost — similar in spirit to cap rate but simpler to calculate.
Why it matters
Comparing rental yield across neighborhoods or property types can help identify areas where rental economics work better for investors.
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