Capital appreciation: definition

Capital appreciation refers to the increase in a property’s value over time. This potential capital gain adds to the rental yield and plays a major role in building wealth.

Environment and capital appreciation

It depends on many factors: location quality, the property’s condition, local market trends, and economic and demographic dynamics. Investing in a well-located, well-maintained property increases the likelihood of capital gains over the long term.

Long-term capital appreciation

A homeowner buys an apartment in a fast-growing neighbourhood near a future train station. Ten years later, the value has increased by 25% thanks to capital appreciation, in addition to the rental income received. This capital gain significantly strengthens their wealth, even if the annual rental yield was not exceptional at the outset.