The three risks that show up in practice

Most published risk is macroeconomic and abstract. The risks that actually reduce a real return are smaller, duller and far more likely: the flat sat empty, something broke, or the person paying the rent stopped.

Vacancy costs more than it looks like it does

Do the arithmetic before reading anyone's assumption. A property empty for one month out of twelve loses roughly eight percent of that year's rent. Two months is about seventeen percent. Set that against a gross rental yield of a few percent and you can see that a single unusually long void does more damage to a year's income than most of the market movements people worry about.

And the costs do not pause

During a void the rent stops and much of the expense does not. Municipal rates generally fall on whoever occupies a property, so when nobody does, they fall back on the owner; some municipalities allow limited relief for a genuinely empty property, on their own conditions and for a limited period, and it is not something to assume. Building committee charges continue. Insurance continues. Management fees may continue. A void is not a neutral pause; it is a month of costs with no income against them.

What actually reduces vacancy

Not optimism. Demand does: proximity to employment, transport and schools, a unit type that matches who is actually looking in that area, a rent set at the market rather than above it, and a manager who starts marketing before the current tenant leaves rather than after. When an opportunity assumes very low vacancy, the question is which of those it can point to.

Repairs: two different things wearing one word

Routine maintenance is predictable and small — taps, paint, servicing, the periodic refresh between tenants. Capital items are neither: a roof, plumbing risers, a lift, electrical rewiring, remediation of damp. The first belongs in the operating budget. The second belongs in a reserve, and its likelihood is largely a function of the building's age and how well it has been looked after. An older building at a lower price is not automatically cheaper; part of that discount is a maintenance bill that has not been presented yet.

Tenant risk is a legal-timetable problem

A tenant who stops paying is not only a cash-flow event. Recovering possession is a legal process with its own timetable, and during it the costs continue while the income does not. This is why deposits, guarantors, references and a manager who chases arrears in week one rather than month three are worth more than they appear on a fee schedule.

Liquidity risk, briefly

The third one deserves its own article, and has it. In short: an exit may not be available when you want one, at any price you would accept. Property is slow to sell even in an active market, a hold period is a plan rather than a promise, and a secondary mechanism improves your chances without creating a buyer out of nothing.

How these interact, which is the real point

Individually each of these is survivable. They are dangerous together, and they arrive together: a downturn produces longer voids, tighter tenants and fewer buyers at the same moment, and if the asset is borrowed against, the interest continues through all of it. That is why reserves, a realistic vacancy assumption and modest leverage matter more than any single headline number — they are what determines whether a bad year is an inconvenience or a forced sale.