In particular we focus on getting the loan structure right the first time, choosing which lenders to use in the right order (yes this is important) and finally getting our clients the best deal possible.
Understanding rental yields is important for real estate investors as it helps determine what the ongoing yield of a potential investment is and whether it is in line with the overall investment objectives. Typically, the driving force behind purchasing an investment property is to make more money. If you’re a property investor, rental yield can give you an idea of how much money you’re earning each year on your property.
There are 2 ways to calculate rental yield:
- Gross rental yield – is the simplest of the two ways, as it only considers the rental income and the value of the property. You divide the total annual rental income by the property value, then times by 100. Rental income / property value x 100
- Net rental yield – is more complex as you need to include any property fees and expenses. Add up all the fees and expenses, subtract from the annual rent, divide by the property value and multiply by 100. Annual rental income – property expenses / property vale x 100.
What's a good rental yield?
In Australia a good gross rental yield is around 5-8% and a good net renal year of 4.5% or higher is considered strong.
