By clicking “Accept”, you agree to the storing of cookies on your device to enhance site navigation, analyze site usage, and assist in our marketing efforts. View our Cookie Policy for more information.

Net Yield (real estate)

A measure of the profitability of a rental property that takes into account the expenses associated with owning and maintaining the property. 

The net yield is a more accurate indicator of the overall profitability of a rental property than gross yield, as it takes into account the costs of owning and maintaining the property. However, it is important to note that net yield can vary significantly depending on the specific expenses associated with a property and the local market conditions.

The net yield is calculated by subtracting these expenses from the gross rental income of the property and dividing the resulting number by the purchase price or current market value of the property.

For example we calculate the net yield for real estate assets on the MetaWealth™ app like using this formula:

Year 1 Gross Rental Income of €126,700 and expenses totalling €11,973 would be calculated as follows:

(€126,700 - €11,973) / €2,000,000 = 5.74%

The factors we are taking into account when calculating the expenses are these: 

Property Taxes:

    Taxes that are levied on real estate by local governments. The amount of property tax that a property owner is required to pay is typically based on the value of the property, although other factors such as the location and use of the property may also be considered.

Annual Asset Management:

    The charges are assessed by asset management firms to cover the costs of managing investment assets on behalf of clients, covering activities such as leasing, tenant issues, portfolio monitoring, risk management, and reporting to clients.

    Fees on this asset are based on the total gross rental income generated by the portfolio of apartments over the course of a year, and are calculated by multiplying the gross rental income by the asset management fee percentage. For example in Year 1, €126,700 x 5% = € 6,335.

Hold Period:

    Refers to the length of time that an investor intends to own an asset.

    This can vary widely depending on the investor's goals, specific characteristics of the property and external factors like market conditions.

    MetaWealth™ has recommended an Investment Hold Period of 5 Years for this type of asset based on the investment goals of; passive income and capital appreciation.

Extra reading: 

Why Is It Important to Start Investing Early? Case Comparison

Find out exactly why it is important to start investing early, with all the benefits explained and a case vs. case comparison example for investing early vs. investing later.

Have any questions?

If you have any other questions please feel free to reach out to us using the contact us page.

Customer Support
MetaWealth logo

Next Generation
For Everyone.

MetaWealth InstagramMetaWealth twitterMetaWealth facebookMetaWealth LinkedinMetaWealth tiktokMetaWealth app Telegram
Why MetaWealth™?How Investments WorkInvestment Portfolio
MetaWealth™ Newsletter
Subscribe to our newsletter
Thank you for subscribing to our newsletter!
Oops! Something went wrong while submitting the form.

The MetaWealth™ platform is operated by MetaWealth™ International, which is not a registered broker-dealer or investment advisor. MetaWealth™ does not provide investment advice, endorsement or recommendations with respect to any properties listed on the platform. Nothing on the platform, website or application should be construed as an offer to sell, solicitation of an offer to buy or a recommendation in respect of a security. You are solely responsible for determining whether any investment, investment strategy or related transaction is appropriate for you based on your personal investment objectives, financial circumstances and risk tolerance. It’s important to remember that the value of any investment can go up or down. You should consult with licensed legal professionals and investment advisors for any legal, tax, insurance or investment advice before making an investment decision. A financial advisor can help you to understand your financial goals and risk tolerance, and provide guidance on the best investment opportunities for you. MetaWealth™ does not guarantee any investment performance, outcome or return of capital for any investment opportunity posted on this site. MetaWealth™ is under no obligation to maximise profits. Our primary commitment is to safeguard investor capital and strive to deliver on projected returns. By investing, participants agree to relinquish any claims to profits or returns beyond those expressly projected and realised, as stated herein. By accessing the platform including web site and application, any pages thereof, you agree to be bound by the Terms of Service and Privacy Policy.