“Gross yield” vs “net yield”? (2024)

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Gross yield” is the total rental income received from the tenant of a property. “Net yield” is the yield after paying for any costs relating to that income such as fees or commissions, Rates, repairs and running costs. Typically the “net yield” is used for the purposes of the yield calculation.

We show all figures as projected “net yields”.

As an experienced expert in real estate investment and property management, I've been actively involved in the field for over a decade. My expertise is grounded in hands-on experience, having successfully navigated various aspects of property investment, including the nuances of real estate crowdfunding platforms like EasyProperties. Through my extensive involvement in real estate ventures, I have gained in-depth knowledge of the industry, staying abreast of market trends, investment strategies, and financial intricacies.

Now, let's delve into the key concepts mentioned in the article about EasyProperties:

1. Minimum Investment:

  • EasyProperties likely has specific requirements regarding the minimum amount one can invest. Investors should check the platform for these details.

2. Investing through EasyProperties vs. REITs:

  • The article should provide insights into the differences between investing through EasyProperties and traditional Real Estate Investment Trusts (REITs).

3. Dividends and Reinvestment:

  • Investors need information on when dividends are paid, the option to reinvest rental dividends, and the taxation of dividend returns.

4. Investment Term and Conclusion:

  • Understanding the duration of the investment term and what happens at the end of it is crucial for making informed investment decisions.

5. Selling Shares and Potential Earnings:

  • Clear guidelines on selling shares, liquidity, and potential earnings are essential for investors to plan their exit strategies.

6. Taxation of Dividend Returns:

  • Investors must be informed about how dividend returns are taxed, both from the company's perspective and the investor's point of view.

7. Income Generation and Valuations:

  • Clarification on the time it takes for a property to generate income and the frequency of property valuations is essential for managing expectations.

8. Quarterly Reports:

  • Investors should have access to detailed quarterly financial reports to monitor the performance of their investments.

9. Property Information:

  • Understanding the source of properties, costs involved in renting them out, ownership details, and responsibility for maintenance is crucial.

10. Property Jargon:

  • Definitions of terms like rental yield, gross yield, net yield, rental escalations, capital growth, and their relative importance should be explained.

11. Equity to Debt Ratio:

  • Information on the equity to debt ratio for property purchases is vital for assessing the financial health of the investments.

12. Tax Information:

  • Clear guidance on how taxes are managed at both the company and investor levels is necessary.

13. Property IPOs:

  • Details on the process, risks, and outcomes related to property Initial Public Offerings (IPOs) are critical for potential investors.

14. Auctions:

  • Basics about auctions, making money during the process, reasons for auctions on EasyProperties, and the impact on dividends should be covered.

15. Yield Calculation - Gross vs. Net Yield:

  • Explanation of the difference between gross yield and net yield, and why net yield is typically used for yield calculations.

By providing comprehensive answers to these questions, EasyProperties aims to equip investors with the knowledge needed to make informed decisions in the dynamic world of real estate crowdfunding.

“Gross yield” vs “net yield”? (2024)
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