Rental Yield in Montevideo 2026: Gross vs. Net
INGAR · · Investment
There is no single official rental yield for Montevideo or Uruguay. For a specific property, gross yield is annual rent divided by price. Net yield subtracts vacancy, management, maintenance, taxes and other owner costs and divides the result by all capital invested.
The useful figure comes from the unit's supported price and rent with visible assumptions, not a generic ranking. We have removed our in-house averages and ranking while that dataset is under audit.
The two formulas
Gross rental yield
(Monthly rent × 12) / purchase price × 100. Useful for filtering, but it omits acquisition and operating costs.
Net rental yield
(Rent actually collected − all owner costs) / total capital invested × 100.
Total capital includes price, acquisition costs and initial work. Annual costs may include vacancy, management, maintenance, insurance, Contribución, Primary Education Tax, owner-paid common charges and income tax.
An explicitly hypothetical, reproducible example
This example teaches the calculation; it is not a Montevideo average or a real property.
| Assumption | Amount |
|---|---|
| Price | USD 120,000 |
| Assumed acquisition costs | USD 10,000 |
| Total capital | USD 130,000 |
| Assumed monthly rent | USD 700 |
| Contractual annual rent | USD 8,400 |
Gross yield on price is 8,400 / 120,000 = 7.0%. For net yield, assume one uncollected month (USD 700), management (USD 840), maintenance and property costs (USD 1,000), and example income tax (USD 882). Net cash flow is USD 4,978 and net yield on USD 130,000 is 3.83%.
Replace every assumption with evidence. The USD 882 tax input equals 10.5% of gross rent only to demonstrate the arithmetic: DGI publishes that withholding/advance for certain non-resident rents, but final settlement and options depend on the taxpayer. Do not copy it without tax review.
Which rent to use
Prefer, in order: the unit's current lease; recent receipts; leases in the same building; then genuinely equivalent comparables by type, condition and location. A listing is an expectation, not collected income.
INE publishes averages of contracts in covered administrative sources. They are dated context, not the rent of a unit and not a yield by themselves because they do not contain a comparable purchase price for that same asset.
Costs that belong in net yield
- Vacancy and arrears.
- Management and tenant-placement cost.
- Maintenance and replacements.
- Contribución and Primary Education Tax.
- Insurance and banking costs.
- Owner-paid common charges.
- IRPF or IRNR for the taxpayer.
- Acquisition costs in invested capital.
How to compare two properties
Use the same period, currency and cost rules. Do not compare gross short-term rent with net annual rent or asking price with closed price. Test at least three rents, two vacancy levels and a maintenance reserve.
| Control | Property A | Property B |
|---|---|---|
| Total capital | Price + closing + initial work | Price + closing + initial work |
| Income | Same lease type | Same lease type |
| Vacancy | Same assumption | Same assumption |
| Costs | Same rule | Same rule |
Frequently asked questions
What is rental yield in Montevideo?
There is no single official figure. Calculate it for the property from total cost and supported rent; an average that does not match asset type, location, lease, period and costs can mislead.
What is rental yield in Uruguay?
There is no comparable official nationwide average either. Markets, property types and leases differ; calculate each asset and only compare using consistent assumptions.
Should I use gross or net rental yield?
Gross yield is useful for screening. For a decision, use net yield on total capital after vacancy, management, maintenance, taxes and expenses.
Official sources
- INE — rental market, June 2026
- DGI — IRPF on rent
- DGI — IRNR and rental withholding
- DGI — Primary Education Tax 2026
- DGI — ITP
The example is hypothetical and is not tax advice or a return forecast.