sajad torkamani

Return on investment (ROI) is the annual rental profit divided by the money you put into the property, expressed as a percentage:


annualRentalProfit / moneyYouPutInToAcquireTheProperty 


Property priceDeposit vs MortgageAnnual rental profitROI calculationROI
£100,000£25,000 & £75,000£3,000£3,000 / £25,000012%

Things to keep in mind

  • Whilst ROI is important to keep in mind when investing in a property, capital growth should also be considered. For example, you might be better off with a property that has a ROI of 3% but a capital growth potential of 120% in the next year than a property with a ROI of 10% but but no projected capital growth.