Ranking
Highest gross rental yields in southern Europe
Gross rental yield (annual rent as a share of the purchase price) in Spain, Portugal, Greece and Cyprus, ranked from high to low.
Gross yield is rent before costs divided by purchase price. It is the number every listing quotes and the number that flatters every market, because it ignores the transaction costs you paid to get in, the annual taxes you pay to stay in, the weeks the property sits empty and the management fee if you are not there to hand over the keys yourself.
It is still worth ranking, because the spread between these four countries is wide enough to survive all of those deductions. What the order does not tell you is whether you are legally allowed to earn that rent. Every one of these countries has tightened short-term letting, and Greece goes furthest: a property bought under the golden visa may not be let short-term at all.
Why each country sits where it does
1. Spain 6.5%
Spain leads at 6.5 percent, and the figure is falling: it was 7.2 percent a year earlier. The national average also hides the cities where most foreign buyers actually look, because Madrid runs around 4.5 percent and Barcelona around 4.8 percent. The regulatory direction is the real risk here rather than the number. A tourist let needs a regional licence and, since 1 July 2025, a national registration number, platforms may only list registered properties, several regions have frozen new licences, and Barcelona intends to end tourist flats altogether by the end of 2028.
2. Cyprus 5.1%
Cyprus is second at 5.1 percent, with Limassol reaching around 6 percent on its own. It is arguably the most usable number on this list, because it comes with the lightest rules: a short let needs registration in the Deputy Ministry of Tourism register, the number shown in every listing, and renewal every three years. There are no city-level caps or bans as of mid-2026, though enforcement against unregistered listings is tightening. Combine that with no annual property tax and no wealth tax, and the gap between gross and net is narrower here than anywhere else on the list.
3. Greece 4.4%
Greece sits at 4.4 percent nationally, but Athens alone runs closer to 5.5 percent, so where you buy moves this figure more than in any other country here. Two rules can remove the income. New short-term registrations are banned in central Athens districts 1 to 3 through the end of 2026 with Thessaloniki following in March 2026, and any property bought under the golden visa may not be let short-term at all: that is a EUR 50,000 fine per property and revocation of the permit. Long-term letting remains open and is taxed on a scale from 15 percent up to 45 percent.
4. Portugal 4.3%
Portugal is last at 4.3 percent, and that is the trade rather than a failure: it also has the steepest five-year price growth on this list at about 70 percent, so the return has been arriving as capital appreciation instead of rent. Lisbon yields around 3.8 percent, with Setubal up to 4.9 percent. The letting regime is the most predictable of the four: Decree-Law 76/2024 lifted the national freeze and made Alojamento Local licences permanent and transferable again, leaving control with municipalities, and Lisbon still restricts new registrations in containment zones.
Methodology, and what this ranking does not say
- Sorted by
- National average gross residential yield, from high to low.
- As of
- Country records last checked August 2026. Underlying yield figures date from Q3 2025 to Q2 2026 depending on the country.
- Gross, not net. Deduct annual property tax, management, insurance, maintenance and vacancy, and a headline yield of 6.5 percent typically becomes something closer to 4 percent in practice.
- These are national averages and the capitals sit well below them. Madrid runs around 4.5 percent and Barcelona around 4.8 percent against a Spanish average of 6.5 percent; Athens runs around 5.5 percent against a Greek average of 4.4 percent.
- The underlying figures come from different sources and quarters per country, so small differences between neighbouring entries are not meaningful. A gap of 0.1 percentage point is noise.
- Yield says nothing about capital growth, and the two often move in opposite directions. Portugal has the lowest yield here and the steepest five-year price growth at about 70 percent.
- Letting rules can remove the income entirely. Short-term letting is prohibited on Greek golden-visa property, banned for new registrations in central Athens through the end of 2026, and being phased out for tourist flats in Barcelona by the end of 2028.
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