FAQFractional Real Estate Basics
What is the difference between rental yield and capital appreciation?
Quick answer
Rental yield is the recurring income a property earns from rent, expressed as a percentage of its value each year. Capital appreciation is the increase in the property’s market value over time. Total return combines both — the ongoing rent you collect plus any gain when the property is sold.
Rental yield
Rental yield is the recurring income a property earns from rent, expressed as a percentage of its value each year. It is the part of your return you receive while you hold.
Capital appreciation
Capital appreciation is the increase in the property’s market value over time. You realise it when the property, or your share of it, is sold, and it is not guaranteed: it depends on the market at the time.
Total return
Total return combines both: the rent you collect along the way plus any gain when you sell. Judge an investment on both parts, not on a single headline number.
