Have you ever wondered how we calculate the income you receive each month? We’ve put together a quick guide of what makes up a dividend yield, and how we ensure your investments work in the most efficient way possible.
When you make an investment on our platform, you own a portion of an individual property via a specific UK Limited Company, a Special Purpose Vehicle (SPV), receiving a share of the dividends from that SPV every month.
Any income earned is directly proportional to your ownership of the property, providing a flexible buy-to-let alternative – with the option to buy more shares in a property (earning more income) or sell them on our Resale Market.
How is a dividend yield calculated?
We provide dividend yield estimates prior to investment (along with any capital growth prospects), to help customers decide whether a property is right for them.
To calculate income from a property, we use the latest independent chartered surveyor valuation which provides a reliable and up to date estimate of the property value and its projected rent.
Many traditional property investment providers promote gross yields, or net dividend yields, which only account for mortgage costs. However, all buy-to-let landlords, and seasoned property investors will know that other property related costs should be factored in. These include:
– purchase costs
– annual voids
– letting and management costs
– property insurance
– forecast maintenance
– corporate taxation
– mortgage interest payments
As we make prudent assumptions for the above factors, you’ll be pleased to know that our dividend calculations already cover these associated costs, structured for investors to plan realistic returns.
Our team of property experts continue to search for the most competitive deals, using the investment criteria detailed in our property Acquisition Strategies. We believe that this expertise, coupled with our transparent income calculations, provides the most efficient and hassle-free way to invest in property.
Capital at risk. The value of your investment can go down as well as up. Gross rent, dividends and capital growth may be lower than estimated.