In Latvia it is the most profitable to rent real estate, the yield is 8,06, and in Macedonia 6 percent

Photo: Pexels/andrea-davis

Latvia, Ireland and Italy top the list of countries with very high average rental yields in Europe, according to data from the Global Property Guide updated in the first quarter of this year, Euronews reports.

With a rental yield of 8,06 percent, Latvia ranked at the very top, and if they remain stable, it will take approximately 12 years of rental income to recoup the initial investment in real estate in Latvia. In Ireland and Italy, the required number of years would be thirteen and fourteen, respectively. In Ireland the rental yield is 7,85 percent, in Italy – 7,38 percent, in Romania – 6,63 percent, in Lithuania – 6,44 percent, in Turkey – 6,36 percent, in Great Britain – 6,21 percent, Spain – 6,17 percent, in Macedonia – 6 percent, in Montenegro – 5,95 percent. When it comes to major European cities, Dublin leads the way with an average rental yield of 7,33 percent. In that city, two-room apartments represent the most profitable investment, H1 reported.

The investor needs to invest 365.000 euros with a monthly rent of 2.500 euros, which would result in a yield of up to 8,22 percent. Istanbul and Riga are also attractive options with average rental yields of 6,6 and 6,5 percent.

First among the 10 worst European countries in terms of rental yield is Luxembourg, which offers the lowest yield of 2,67 percent, the least attractive to investors. A two-room apartment there has an average price of 1,2 million euros. However, with an average monthly rent of €2.800, this investment yields a gross rental yield of just 2,7 percent, so in Luxembourg it would take an average of 37 years for an investor to recoup the initial investment in an apartment through rents, assuming constant returns. Switzerland is next where it takes 33 years to pay back the investment.

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