A repeatable method for comparing long lets, holiday rentals and IHS without confusing potential rent with cash return.

Key points in 30 seconds

• 1,436,250 tourist arrivals in 2025 (+3.9%).

• Net yield should be calculated on total cost, not price alone.

• 2025 TDS: 7.5% on qualifying rent paid to a resident and 10% to a non-resident.

• Portal data shows asking prices, not transactions.

Use the right equation

Gross yield is annual rent divided by purchase price. Net yield deducts vacancy, management, service charges, insurance, maintenance, furniture replacement, owner-paid utilities, tax and platform fees. The denominator should be total cash cost price, duty, notary, FX and works rather than the advertised price alone.

A worked example

A MUR 15 million property with MUR 1.9 million of costs and works, rented at MUR 90,000 for eleven months, shows 6.6% gross on price. After MUR 300,000 of operating costs, income falls to MUR 690,000: 4.1% on a MUR 16.9 million total cost, before finance and tax. Vacancy and refurbishment assumptions can therefore move the outcome by several percentage points.

Long let, holiday rental or IHS

Long lets provide more predictable occupancy, fewer turnovers and lower management intensity. Holiday rental may lift revenue but requires marketing, cleaning, rapid maintenance and operating compliance. IHS delegates operations to the hotel with limited owner use and a contractual distribution. Compare net income, management time, volatility and resale liquidity.

Build a real operating statement

Use twelve months rather than multiplying headline rent by twelve. Deduct vacancy, arrears, management, service charges, insurance, routine maintenance, major-works reserve, furniture, subscriptions, cleaning, platforms and tax. Separate recoverable expenses. For a financed asset, calculate cash flow after interest and principal while recognising that principal is not the same as a tax expense.

Evidence to request

Obtain twenty-four months of rent collected, occupancy, platform statements, management invoices, co-ownership charges, works and tax. For new property, use at least five documented comparables rather than the developer’s projection alone. Map monthly seasonality and the target segment: visitors, expatriates, companies, students or retirees.

Scenarios and break-even

A prudent case reduces rent or daily rate by 15%, increases costs by 20% and adds one vacant month. Calculate the minimum occupancy needed to cover operating costs and debt. If a moderate variation makes cash flow negative, the margin of safety is inadequate despite an attractive gross yield.

Use market evidence carefully

Statistics Mauritius recorded 1,436,250 tourist arrivals in 2025, up 3.9%, followed by 6.8% growth in Q1 2026. This supports visitor demand but does not guarantee occupancy for an individual home. Portals report asking prices, not completed sales: in August 2026 PropertyCloud showed average Grand Baie asking prices around MUR 27.2 million and average asking rent near MUR 80,000 per month, with a very wide spread. Each asset needs its own comparable set.

Tax and compliance

From income year 2025-26, individual chargeable income is taxed through 0%, 10% and 20% bands, not a universal 15% rate. Tax may be withheld on qualifying rent paid by an entity: the MRA’s 2025 guide states 7.5% for a resident payee and 10% for a non-resident; withholding is a credit, not necessarily the final liability. Holiday-use permissions, co-ownership rules and insurance must also be checked.

Stress-test the plan

Model a base case, high-vacancy case and major-repair case. For holiday rentals, test monthly nightly rate, occupancy, commission and cleaning. For IHS, examine the distribution formula, furniture reserve and owner-use rights. Never describe a forecast as guaranteed unless a solvent counterparty makes a clear contractual commitment.

Frequently asked questions

What yield should I target?

There is no reliable island-wide rate. The right target depends on area, asset, strategy and net return after every cost.

Does holiday rental always earn more?

No. Higher revenue may be absorbed by vacancy, commission, cleaning, utilities, furniture and management.

Is residential rent subject to VAT?

Residential letting generally receives distinct treatment, but short stays and services can change the analysis; obtain tax advice.

Is withholding the final tax?

Not necessarily. It is generally a credit against the liability determined in the tax return.

How do I test a rental projection?

Request monthly assumptions, documented comparables and a downside case, then calculate net return on total cost.

Related MYKEYS guides

• Why Invest in Mauritius Property in 2026 and Why Selectivity Matters

• Mauritius Property Market 2026: Reading the Numbers Without Overclaiming

• Mauritius West Coast: Comparing Tamarin, Black River and Flic-en-Flac

• Mauritius Invest Hotel Scheme: Owning a Hotel Unit Without Mistaking It for a Guaranteed Return

Browse property for sale in Mauritius | Contact MYKEYS

Sources

• Statistics Mauritius International Travel and Tourism, year 2025

• Statistics Mauritius International Travel and Tourism, Q1 2026

• Mauritius Revenue Authority individual income-tax rates and filing

• Mauritius Revenue Authority Tax Deduction at Source Guide 2025

• PropertyCloud live asking-price sample, Grand Baie (accessed 12 Aug. 2026)

• PropertyCloud live long-term asking rents, Grand Baie (accessed 12 Aug. 2026)

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