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    Why is the ROI generally higher for smaller units

    Ali Faizan Syed1 min read0 viewsUpdated 12/28/2025
    Smaller units like 3 and 4 bedroom townhouses often generate higher rental yields compared to massive 6 bedroom mansions because the pool of tenants who can afford them is much larger. The purchase price is lower which keeps the denominator of the ROI calculation small while the rent per square foot is typically higher for smaller manageable units. This makes standard townhouses the sweet spot for yield focused investors versus luxury mansions which are better for capital growth.

    Related Topics:

    rental yields unit size tenant pool affordability investment sweet spot
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