Investing in real estate in Alagoas, Brazil, is a unique opportunity for foreign investors. Located along some of the country’s most beautiful beaches, this region combines a growing market with attractive rental yields. This guide explains what rental yield is, how to calculate it, and why Alagoas is a strategic choice for your investment.
What is rental yield?
Rental yield measures the profitability of a real estate investment and is expressed as a percentage. It compares the income generated by renting a property to the amount invested.
Gross yield
Gross yield (%) = (Annual rents / Purchase price) × 100
This gives a first idea of profitability, without considering costs.
Net yield
Net yield (%) = [(Annual rents - Expenses) / Purchase price] × 100
By deducting taxes, management fees, and maintenance, you get a more realistic estimate.
Net-net yield
Net-net yield (%) = [(Annual rents - Expenses - Taxes) / Purchase price] × 100
For foreign investors, this calculation is essential because it includes Brazilian taxation.
Example of rental yield in Alagoas
Suppose you buy an apartment in Maceió for €70,000 and rent it out for €400/month during the high season.
- Annual rent: 400 € × 12 = 4,800 €
- Annual expenses (taxes, maintenance): 500 €
- Purchase price: 70,000 €
Gross yield:
(4 800 / 70 000) × 100 = 6,85 %
Net yield:
[(4 800 - 500) / 70 000] × 100 = 6,14 %
Net-net yield (assuming 15% tax):
[(4,800 - 500 - 645) / 70,000] × 100 ≈ 5.9%
Rental yields in Alagoas vs Europe
Rental yields in Maceió, Alagoas, can reach around 6.85% gross for furnished apartments. By comparison, average gross yields in some major European cities are:
- Paris, France: 4.76%
- Brussels, Belgium: 5.43%
- Amsterdam, Netherlands: 5.00%
- Berlin, Germany: 4.90%
- Madrid, Spain: 5.04%
- Rome, Italy: 7.04%
(Source : Global Property Guide)
This shows that rental yields in Alagoas are competitive, and often higher than in many European cities, while offering more accessible purchase prices and high potential for property appreciation.
Why invest in Alagoas?
Several factors make Alagoas particularly attractive for rental investments:
- Strategic location: Close to paradisiacal beaches and tourist centers, with strong seasonal rental demand.
- Attractive purchase prices: Apartments in Alagoas are more affordable than in Rio or São Paulo, offering better potential returns.
- Economic growth: The Alagoas real estate market is expanding, ideal for long-term appreciation.
- Installment payments: Pay over several years without interest.
To discover our properties in Alagoas and start your investment, check out our property selection or explore our full range of services, including rental management, for personalized support.