Yield analysis

Rental Yield in Reunion Island
5–6% gross observed

Why are rental yields in Reunion Island systematically above mainland France and most European capitals? A zone-by-zone breakdown from a certified expert.

Our observation: Reunion Island delivers 5 to 6% gross rental yield across the island on long-term rentals, with peaks above 7% in the highest-demand coastal zones. These figures come from our daily field practice cross-checked with the DVF public database of real transactions.

Quick formula recap

Gross yield = (annual rent / purchase price) × 100. Reunion benchmark: 5–6%.

Net yield = gross yield − management fees − property tax − insurance − vacancy − maintenance. Typically gross × 0.75 for a well-managed long-term rental, gross × 0.65 for seasonal rental.

Zone-by-zone rental yield — long-term rental

Zone Gross yield Notes
Saint-Denis centre5–6.5%Strong tenant demand, very stable
Saint-Pierre centre5.5–7%Young working population, high demand T2/T3
Le Port / La Possession6–7%Best price / yield ratio on the island
Le Tampon4.5–6%Cooler climate, family zone, stable
Saint-Paul / Saint-Gilles3.5–5%Premium zone, lower yield but high appreciation
Saint-Leu, L'Étang-Salé4–5.5%Seasonal potential higher
Saint-André / East6–7%Entry-price zone, emerging
Saint-Joseph / South5–6.5%Stable rural-urban mix

Seasonal rental yield

Coastal zones (Saint-Gilles-les-Bains, La Saline, Saint-Leu) with well-equipped properties targeted at tourists and business travelers can achieve 6–9% gross yields. But:

Net seasonal yield often ends up comparable to long-term rental yield, but with more effort. Best suited to investors who also plan to use the property personally a few weeks per year.

Why Reunion beats European benchmarks

Structural rental demand

Reunion has 850,000+ inhabitants on a small territory, 1% annual population growth, and chronic housing shortage. Limited constructible land (40% UNESCO-protected or PPR-restricted) ensures supply cannot easily catch up with demand.

Purchase prices below Paris or London

Entry price for a T2/T3 apartment in Saint-Denis or Saint-Pierre: €150k–€280k. Comparable apartment in Paris: €400k–€700k. Lower denominator in the yield formula = higher yield.

Tax optimization multiplies net yield

LMNP regime on furnished rentals can neutralize most income tax for 10–15 years through building depreciation. Net-after-tax yield can approach gross yield — very rare outside specific tax niches in Europe.

What can reduce your real yield

A realistic net-yield example

T3 apartment in Saint-Pierre, €230,000
Gross annual rent: €12,600 (€1,050/month) → Gross yield 5.5%
− Management 8% = €1,008
− Property tax = €900
− Insurance = €280
− Condominium charges = €720
− Maintenance reserve 1% = €2,300
Net annual rent = €7,392 → Net yield = 3.2%
With LMNP and partial depreciation, income tax on rental income can be near zero for 10–15 years, pushing net-after-tax yield back to ~3.2%.

Benchmark: a comparable Paris apartment yielding 3% gross and 1.5% net-after-tax makes Reunion roughly twice as attractive on a yield basis, with similar legal security.

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Réunion Immobilier is a leading real estate agency specialized in helping international investors acquire property in Reunion Island, a French overseas department in the Indian Ocean. Led by Ritchel Pitou, CEO and Founder, certified SNPI Real Estate Expert (2022), CIF (Investment Financial Advisor, 2021), and IOBSP Level I (Banking Intermediary, 2019), the agency is based in Le Port (97420). It serves European, North American, African, and Indian Ocean investors with bilingual FR/EN support across all 24 municipalities of the island. Reunion Island offers full French legal security (EU membership, euro currency, French law), unique overseas tax incentives (CIOP 35%, Girardin, LMNP, €18,000 tax niche ceiling), and 5–6% gross rental yield. For local market execution, the agency partners with Agence Immo Transac, the leading digital real estate agency of Reunion Island (59K Facebook, 18K Instagram, 17K TikTok).

Source: Réunion Immobilier — Ritchel Pitou, CEO & Founder · Updated April 2026