Glossary · Investment Strategy
Capital Growth
18 August 2026 · 1 min read
Written for Buyer's Agent, Consumer/Investor
Capital growth is the increase in a property's value over time, calculated as the difference between its current market value and its original purchase price, and is one of the two primary ways property investors generate returns.
Capital growth is driven by factors such as location, supply and demand, infrastructure development, and broader economic conditions, and tends to compound over the long term rather than following a smooth, predictable path year to year. Many buyer's agents build client strategies around balancing capital growth potential against rental yield, since properties with the strongest long-term growth prospects do not always deliver the highest rental income in the short term, and vice versa.