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Rental Yield Calculator

Calculate Gross and Net ROI for Investment Properties

Gross Yield
0.00%
Net Yield
0.00%
Monthly Cash Flow
$0

How to Calculate Rental Yield: A Guide for Investors

Whether you are a seasoned real estate investor or buying your first buy-to-let property, understanding rental yield is critical for assessing the profitability of your investment. Rental yield is a percentage that shows the annual return on your investment property relative to its purchase price.

Gross vs. Net Rental Yield

Gross Rental Yield is the simplest calculation. It measures the total income generated before any expenses are deducted. While useful for a quick comparison between properties, it doesn't paint the full picture of your actual take-home profit.

Net Rental Yield is the more accurate metric. It accounts for the costs associated with owning the property, such as property taxes, landlord insurance, maintenance fees, and vacancy periods. A property with a high gross yield but massive maintenance costs might actually have a lower net yield than a cheaper, low-maintenance flat.

The Formulas

  • Gross Yield Formula: (Annual Rental Income / Property Price) x 100
  • Net Yield Formula: ((Annual Rental Income – Annual Expenses) / Property Price) x 100

What is a Good Rental Yield?

Generally, a rental yield of 5% to 8% is considered solid in many markets. However, this varies significantly by location. In high-growth urban areas, yields might be lower (3-4%) because investors expect more from capital appreciation (the increase in property value over time). In more affordable regions, you might find yields exceeding 10%.

function calculateRentalYield() { var price = parseFloat(document.getElementById('propPrice').value); var monthlyRent = parseFloat(document.getElementById('monthlyRent').value); var annualExpenses = parseFloat(document.getElementById('annualExpenses').value) || 0; if (!price || !monthlyRent || price <= 0 || monthlyRent <= 0) { alert('Please enter valid numbers for price and monthly rent.'); return; } var annualRent = monthlyRent * 12; var grossYield = (annualRent / price) * 100; var netYield = ((annualRent – annualExpenses) / price) * 100; var monthlyCashFlow = (annualRent – annualExpenses) / 12; document.getElementById('grossYieldResult').innerText = grossYield.toFixed(2) + '%'; document.getElementById('netYieldResult').innerText = netYield.toFixed(2) + '%'; document.getElementById('cashFlowResult').innerText = '$' + Math.round(monthlyCashFlow).toLocaleString(); document.getElementById('resultArea').style.display = 'block'; }

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