Calculate Gross and Net ROI for Your Investment Property
Gross Rental Yield0.00%
Net Rental Yield0.00%
Annual Rental Income:$0.00
Annual Net Cash Flow:$0.00
Understanding Rental Yield for Real Estate Investing
When evaluating a potential investment property, rental yield is one of the most critical metrics you can use. It provides a snapshot of the return on investment (ROI) based solely on rental income, excluding capital gains or property appreciation.
Gross Yield vs. Net Yield
Gross Rental Yield is the total annual rent received divided by the property purchase price. While useful for a quick comparison between properties, it doesn't account for the costs of owning the property.
Net Rental Yield is a much more accurate reflection of your actual profit. It takes into account annual expenses such as property taxes, landlord insurance, maintenance fees, and management costs. A property with a high gross yield but massive maintenance requirements may actually have a lower net yield than a newer, cheaper-to-run property.
How to Use This Calculator
To get the most accurate results, follow these steps:
Purchase Price: Enter the total price paid (or the current market value).
Monthly Rent: Enter the realistic monthly rent based on local market comparables.
Annual Expenses: Include everything you pay yearly. This should include property taxes, insurance premiums, HOA fees, and an estimated 1% of the property value for annual maintenance.
What is a Good Rental Yield?
While "good" varies by location and market conditions, many seasoned investors aim for a net yield of 5% to 8%. In high-demand metropolitan areas, yields might be lower (2-4%), but investors often accept this in exchange for higher potential capital growth.
function calculateRentalYield() {
var purchasePrice = parseFloat(document.getElementById("purchasePrice").value);
var monthlyRent = parseFloat(document.getElementById("monthlyRent").value);
var annualExpenses = parseFloat(document.getElementById("annualExpenses").value) || 0;
if (!purchasePrice || purchasePrice <= 0 || !monthlyRent || monthlyRent <= 0) {
alert("Please enter valid numbers for Purchase Price and Monthly Rent.");
return;
}
var annualRent = monthlyRent * 12;
var grossYield = (annualRent / purchasePrice) * 100;
var netCashFlow = annualRent – annualExpenses;
var netYield = (netCashFlow / purchasePrice) * 100;
// Update Display
document.getElementById("grossYieldResult").innerText = grossYield.toFixed(2) + "%";
document.getElementById("netYieldResult").innerText = netYield.toFixed(2) + "%";
document.getElementById("annualIncomeDisplay").innerText = "$" + annualRent.toLocaleString(undefined, {minimumFractionDigits: 2, maximumFractionDigits: 2});
document.getElementById("netCashFlowDisplay").innerText = "$" + netCashFlow.toLocaleString(undefined, {minimumFractionDigits: 2, maximumFractionDigits: 2});
// Show Results Area
document.getElementById("resultsArea").style.display = "block";
// Smooth scroll to results
document.getElementById("resultsArea").scrollIntoView({ behavior: 'smooth', block: 'nearest' });
}