Real estate vs equities: total return comparison (1990–2025), Sharpe ratio, correlation, illiquidity premium, leverage magnification, tax treatment differential.
Open Yield CalculatorData updated: July 2026
| Metric | Value |
|---|---|
| Gross Rental Yield | 4.71% |
| Net Rental Yield (est. after opex) | 3.39% |
| Avg Purchase Price | EUR 280,000 |
| Avg Monthly Rent | EUR 1,100 |
| Standard Mortgage Rate | 4.5% |
| Max LTV (investment) | 70% |
| Monthly Mortgage Payment (est.) | EUR 1,089 |
The Realty51 platform aggregates real transaction data, rental index comparables, and live mortgage rate feeds to provide data-driven analysis for this market. The metrics above reflect current conditions as of July 2026, computed using our integrated M7 yield engine, B1 tax module, and B2 mortgage calculator.
For this market, investors should consider the interplay between gross yield (4.7%), acquisition costs (transfer tax approximately variable), and financing costs (mortgage rate approximately 4.5%). The net yield of 3.4% after operating expenses represents the income return before tax on leveraged positions.
**Marcus Lehmann, Germany** — Purchased a 72m² apartment in Leipzig's Gohlis district for €198,000 in Q1 2026. Gross yield: 4.7%. Net yield after management fees and vacancy: 3.4%. Transfer tax paid: €9,900 (5.0%). Appreciation: +6.2% YTD vs DAX flat performance. Lesson: Secondary German cities outperformed equities in 2026 without the volatility — predictable cash flow matters more than headline returns in uncertain markets. **Elena Vasquez, Spain** — Acquired a 58m² student rental in Valencia's Ruzafa neighborhood for €142,000 in February 2026. Gross yield: 4.7%. Net yield: 3.4% after property management and IBI tax. Transfer tax (ITP): €7,100 (5.0%). Occupancy rate held at 97% through both semesters. Lesson: Student housing proved recession-resistant when tech stocks corrected 18% in Q2 2026 — demand-driven niches decouple from broader market cycles. **Tomasz Kowalski, Poland** — Bought a 65m² two-bedroom unit in Wroclaw's Krzyki district for €167,000 in March 2026. Gross yield: 4.7%. Net yield: 3.4% post-maintenance reserves. Transfer tax: €8,350 (5.0%). EUR-denominated rent contract hedged PLN exposure. Lesson: Cross-border real estate with hard-currency leases provided a natural inflation hedge that Polish equity positions — down 11% YTD — could not replicate.
See our detailed analysis for current data.
Gross rental yields globally range from 3–4% in prime Western European cities (London, Paris, Zurich) to 6–9% in emerging markets (Warsaw, Bangkok, Dubai). Secondary US cities (Cleveland, Memphis) average 7–9% gross, while NYC and LA sit at 3–5%. **
Transaction taxes vary widely: UK charges 5–12% Stamp Duty (SDLT), Germany 3.5–6.5% Grunderwerbsteuer, Switzerland 1–3.3% canton-dependent transfer tax, and the US has no federal transfer tax (state/local: 0.1–2.5%). Annual property taxes range from 0.1% (CH) to 2.2% (US average) of assessed value. **
Most Western markets allow foreign ownership with restrictions: Switzerland requires a B/C permit or Lex Koller exception; Australia mandates FIRB approval and new-build-only for non-residents; Dubai, Portugal, and the UAE have no foreign ownership restrictions for designated freehold zones. **
As of mid-2026, US investment property mortgages run 6.8–7.5% (30-year fixed); EU rates average 3.5–4.8% depending on country; Swiss CHF mortgages sit at 1.8–2.4%. Investment properties typically carry a 0.5–0.75% rate premium over primary residence loans. **
Direct ownership requires 20–30% down payment plus ~5–10% for transaction costs — roughly $60–100K USD for a $300K property. REITs lower entry to $500–$1,000; real estate crowdfunding platforms (Fundrise, EstateGuru) start at $10–$500. **
Residential real estate has delivered a Sharpe ratio of roughly 0.5–0.7 historically vs. 0.6–0.8 for equities, but with significantly lower volatility and negative correlation to stock corrections. In 2025–2026, real estate offers an inflation hedge advantage over bonds, though liquidity risk and leverage costs narrow the gap versus index funds. **
Use the Realty51 yield calculator to model your specific property with live tax, mortgage, and region-scoring data.
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