(1888PressRelease)
March 07, 2009 - The Global Property Guide (http://www.globalpropertyguide.com), the research site for residential property, released today the results of research into rentals in major cities of Chile. It revealed that:
- Apartments in prime areas of Santiago have excellent average rental yields of 8.16%.
- Apartments in the city of Vina Del Mar yield only half as much, on average, with gross rental yields of around 4.31% only.
The rental yield is the annual rental income on a property, as a percentage of today's property purchase price. This is what a landlord can expect as return to his investment. The rental yield is one useful yardstick of whether property is over-valued or under-valued.
The high yields on apartments in prime areas of Santiago - Las Condes, Providencia, and Vitacura - suggest that these Santiago areas make good residential property investments.
Apartments in prime areas of Santiago cost on average US$ 98,520 for a 60 square meter apartment, according to the Global Property Guide's research, versus US$ 87,480 for the same sized property in Vina Del Mar. However, 120 square meter apartments are more expensive in Vina Del Mar than in Santiago.
The result? Looking across the different sizes, prices in the two cities are more or less the same, on average.
Though apartments in Santiago and Vina del Mar cost around the same, per square meter, yet Santiago apartments produce twice as good rental returns -- i.e., rents for the same sized apartment in Santiago are nearly twice as high. This means that Santiago is much more attractive as a residential investment.
In the southern city of Concepcion, 120 square meter apartments have excellent gross rental yields of 9.04% - also, an excellent level of rental yields, making Concepcion a very attractive investment.
Why consider rental yields? Some investors in residential property may ignore rental returns, being more concerned with capital gains.
Yet even they would do well to consider rental yields. The rental yield, or price/rent ratio, is similar to the price/earnings ratio in the stock market. As in the stock market, property investments with high rental yields tend to perform better, and have higher capital gains, in the long-term.
Extensive Report - http://www.globalpropertyguide.com/Latin-America/Chile/Rental-Yields
Description:
The Global Property Guide is an on-line property research house.
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Publisher and Strategist:
Matthew Montagu-Pollock
Phone: (+632) 867 4220
Cell: (+63) 917 321 7073
Email: editor ( @ ) globalpropertyguide dot com
Address:
Global Property Guide
http://www.globalpropertyguide.com
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info ( @ ) globalpropertyguide dot com
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