PROPERTY RETURNS
2 . Net Rental Yield or Capitalisation Rate for Commercial Property Property Price Growth , however , is not the only return you get on your property investments . In addition to Property Price Growth , you also receive monthly rental income , whether you are renting the property yourself from one of your entities or leasing it to a third party .
The Net Rental Yield , or Capitalisation Rate for Commercial Property , calculates the return you receive on your property investments after all the property expenses have been paid . The formula to calculate it is as follows :
Net Rental Yield = ( Rental Income – Levies – Rates & Taxes – Rental Commission – Maintenance ) x 12 / Purchase Price or Market Value
Understanding the real numbers P . S . It is important to remember that your
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