Yield Return Vs R.O.I

[Kenneth Lim]

We seen alot on the newspaper regarding some properties with high yield return but when we work it out, some of them shows negative cashflow.

[b]Yield Return = gross rental x 12mths / total amt of property

ROI = cashflow x 12mths / the amt you put in[/b]

When we look at a property, can we just look at the ROI and just ignore the yield return because I find yield return is not accuate at all because the gross rental consists of money that does not go into our pocket (goes to monthly mortgage, expenses...) whereas the ROI consists of money that goes into our pocket.

I could be wrong. Please correct me if I am wrong. Thank you.