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Rental Yield Calculator

Calculate the gross and net rental yield on an investment property. Enter your property value, monthly rent, and annual expenses to see your return.

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Insurance, maintenance, management, vacancy

Enter the property value, monthly rent, and expenses, then click Calculate to see your rental yield.

How Rental Yield Works

Understanding Rental Yield

Rental yield is one of the most important metrics for property investors. It measures the annual return you earn from rental income as a percentage of the property's value. This calculator helps you determine both gross and net rental yield so you can evaluate whether an investment property meets your financial goals.

Gross vs. Net Yield

Gross rental yield is the simplest calculation: divide the annual rent by the property value and multiply by 100. It gives a quick snapshot but doesn't account for the costs of owning and managing a property.

Net rental yield is more useful because it factors in your annual operating expenses — things like insurance, property management fees, maintenance costs, and an allowance for vacancy. The formula is: (annual rent minus expenses) divided by property value, multiplied by 100.

What the Numbers Tell You

For example, a $300,000 property renting for $2,000/month ($24,000/year) with $6,000 in annual expenses produces:

  • Gross yield: 8.00%
  • Net yield: 6.00%
  • Monthly cash flow: $1,500

Using Yield to Compare Properties

Rental yield lets you compare properties of different values and rental amounts on an equal footing. A $200,000 property earning $1,200/month has the same gross yield (7.2%) as a $500,000 property earning $3,000/month. But their net yields may differ depending on expenses, making net yield the better comparison tool.

Beyond Yield

While rental yield measures income return, a complete investment analysis should also consider capital growth, financing costs, tax implications, and your local market conditions. Combine yield analysis with cap rate and cash-on-cash return calculations for a comprehensive picture.

Frequently asked questions

Rental yield is a measure of how much income a property generates relative to its value. It is expressed as a percentage and helps investors compare the income-producing potential of different properties. A higher yield generally means more income per dollar invested, though it may also come with higher risk or lower capital growth potential.

A good rental yield typically falls between 5% and 8%, though this varies by market, property type, and location. Properties in high-demand urban areas may have lower yields (3–5%) but stronger capital appreciation, while properties in regional areas or emerging markets may offer yields of 7–10% with less price growth. Always consider yield alongside other factors like vacancy rates and capital growth.

Gross rental yield is calculated using the total rental income divided by the property value, without accounting for any costs. Net rental yield subtracts operating expenses (insurance, maintenance, management fees, vacancy costs) from the rental income before dividing by the property value. Net yield gives a more accurate picture of your actual return.

You can improve rental yield by increasing rent (through renovations, better marketing, or adding amenities), reducing expenses (shopping for cheaper insurance, doing minor maintenance yourself), minimizing vacancy periods (responsive management, competitive pricing), or buying at a lower price. Refinancing to a lower interest rate does not affect yield directly but improves your cash flow.

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