Having an apartment for rent is a business: the annual return generated by the property will vary depending on the rental income, periodic and unforeseen expenses and the price of the home, among other factors.
The comprehensive rental management company Housfy Rental makes available to owners a rental profitability calculator, which measures that performance to consider whether renting is a good investment.
The best way to reduce risks is to be accompanied. Housfy itself can make the operation easier for you thanks to its comprehensive rental management, with which the owner does not have to worry about anything.
Furthermore, having a good wealth advisor at your disposal is key to maximizing profitability. The trick? Maximize performance and adjust expenses.
Get in touch with a Housfy rental expert: they have access to big data bases from which they extract information to offer the best service.
The returns on real estate in Spain are very varied, and will be higher in those municipalities where purchase prices are lower and, even so, there is a lot of rental demand.
According to the latest report from the Bank of Spain, the average profitability of housing (rent plus price changes) was 7.0% during the first quarter of 2023. It is a figure similar to that published by idealista (7.1% ) and higher than that of Fotocasa (6.2%), each using information from their respective databases.
There are several mathematical formulas to calculate rental profitability.
The gross rental profitability is calculated by dividing the annual rental income by the purchase price, multiplied by 100.
If we want to calculate the net profitability, which will give us a much more specific value, we will have to subtract the annual expenses derived from the rental from the income and divide the result by the value of the investment, multiplied by 100.
We understand by expenses all those fixed payments associated with the rent (community of owners, non-payment insurance…), taxes (such as the IBI or the waste collection fee) or even the interest on the mortgage, if any.
