What does high rental yield mean?

When we talk about the subject of high rental yield then here you will see that it is the annual rent value that you are getting from an income generating property and asset. It is measured in percentage form. This also determines how much return you are getting after you have invested your money in assets that are giving you rent on monthly or yearly basis.

This rule applies for all kinds of assets like residential property, commercial property and even for lands that are being given on lease to tenants and those business owners who want to set up a factory. We have seen that in most cases if you get an annual rental yield above 5% then this will indicate a symptom of earning good profits.

How to measure profits with rental yield?

If you make a deep investigation about high rental yield then you will see that its rise and fall will depend on the net rental yield market where assets and properties are being sold and bought. Here property investors have to also consider other important things like property taxes and maintaining charges.

Now you might ask us how you can you measure the percentage of profits from your assets and properties. Well if you see that the percentage of your rental yield is more than 5% then this indicates profit. On the other hand if you observe that your rental yield in percentage is less than 5% then you can conclude that your profit is low.

Know the relation between rental yield and property bonds

With the help and support of high rental yield you will see that your bought asset is generating a stream of regular income. When the issue of rental yield comes in front of investors then they can buy the bonds of real estate properties at a favorable cost price.

When these property bonds mature then they can sell them at a high desired cost price. This will help property investors to remain safe from money losses in the long way when some bonds are sold by defaulters.

Author resource:-

Rick Lopez advises people about real estate, property investment, property management and affordable housing schemes.