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Real Estate vocabulary · Investment & the Market

Return on investment

Meaning in real estate, with examples

nounCommon term

In real estate, return on investment means: The profit from an investment compared with the money put into it, usually shown as a percentage.

In Turkish: yatırım getirisi

How it is used

Shortened to ROI in speech and reports. In property it can include both rental income and the rise in value when the property is sold. Investors ask about the ROI on a renovation, a buy-to-let or a shop unit.

Example sentences

  1. A new kitchen often gives a good return on investment when you sell.

  2. What return on investment are you expecting from the shop?

Common collocations

  • high return on investment
  • calculate ROI
  • ROI on a renovation
  • expected return on investment
  • rental yieldThe yearly rent from a property shown as a percentage of its price or value. A home worth 200,000 that earns 10,000 a year has a 5% gross yield.
  • cap rateShort for capitalisation rate: a property's net operating income divided by its value or price, used to compare returns on income-producing buildings.
  • appreciateOf a property or other asset, to increase in value over time because of demand, location or improvements.
  • flipTo buy a property, often improve it quickly, and sell it again within a short time to make a profit.
  • portfolioAll the properties owned or managed by one investor, company or fund, considered together.

More terms: Investment & the Market

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