Is your investment property actually profitable?

Gross yield looks great until you subtract maintenance, tax, vacancy, and mortgage. Here's what you actually take home.

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Gross yield, net yield, cash-on-cash return — the numbers that actually matter.

Property Details

Typical: 3-8% for condos, 5-10% for landed

Expenses (Monthly)

Non-owner-occupied: 12-36% of Annual Value

Financing

0 if paying full cash
Guide

Understanding Rental Yield in Singapore

Gross vs Net Rental Yield

Gross yield = (Annual Rent / Purchase Price) x 100. This is the headline number but doesn't account for expenses.

Net yield = ((Annual Rent - Expenses) / Purchase Price) x 100. This is the real return after maintenance, property tax, vacancy, insurance, and repairs.

What's a Good Rental Yield in Singapore?

Cash-on-Cash Return

If you're using leverage (mortgage), the cash-on-cash return measures your return on the actual cash you put in — not the total property value. A $1.5M condo with 25% down ($375K cash) earning $3,000/month net cash flow gives you a cash-on-cash return of about 9.6% — much higher than the gross yield suggests.

Tax on Rental Income

Rental income in Singapore is taxable. You can deduct: mortgage interest, property tax, maintenance fees, insurance, repairs, and agent commissions. The net rental income is taxed at your marginal income tax rate (0% - 24% for residents).

FAQ

Frequently Asked Questions

Yes, after the 5-year MOP. You can rent out the whole flat (if you have another place to stay) or rent out rooms. HDB approval is required. Whole flat rental is approved for 2-year periods. Note: HDB rental yields are typically higher than condos because entry prices are lower.
Singapore property has historically appreciated 3-5% annually over the long term. However, with high ABSD rates (20% for SC's 2nd property), the entry cost is significant. Rental yields of 2.5-4% for condos are modest compared to other asset classes. Investment makes more sense if you're a SC buying your 1st property (0% ABSD) or holding long-term (10+ years) for capital appreciation.
Resale condos typically offer higher rental yield (lower entry price, immediate rental income). New launches offer potential capital gains if bought at a good price but have a 3-4 year wait before you can rent. For pure yield, resale is usually better. For capital appreciation play, new launches in growing areas may have an edge.

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