Rental Yield Calculator
Gross and net rental yield, and the annual rent a target yield requires.
Rental yield is the rent a property earns expressed as a percentage of what it cost. The gross figure is quick to compare; the net figure is what the property actually returns once running costs are taken out.
Enter the price, the costs of buying and the rent, then the annual expenses, and this calculator shows both yields and the rent that a target yield would need.
At a glance
- What you enter
- Property price, Purchase costs, Monthly rent, Annual expenses, Empty weeks per year, Target gross yield
- What you get
- Gross yield, Net yield, Net rental income per year, Rent a month for the target yield, Monthly rent gap to the target
- Formula shown
- Yes - every step, right below your results.
- Cost and privacy
- Free, no account needed, and nothing you type is stored.
See worked examples ↓ Read the FAQ ↓ Share this calculator ↓
Results are estimates for general information only - always verify with a professional or official source before acting on them.
How to use the Rental Yield Calculator
- 1 Enter Property price
- 2 Enter Purchase costs
- 3 Enter Monthly rent
- 4 Enter Annual expenses - Service charge, insurance, maintenance, management, tax and any utility the landlord pays.
- 5 Enter Empty weeks per year (weeks)
- 6 Enter Target gross yield
- 7 Press Calculate. You get Gross yield, Net yield, Net rental income per year, Rent a month for the target yield, Monthly rent gap to the target, and every intermediate step stays visible under “How is this calculated?”
- 8 Change one number at a time to see what moves the result - that is usually the most useful thing a calculator can tell you.
Worked examples
Real numbers run through this calculator. Open any example to load it into the form above and change it.
A $250,000 property let at $1,400 a month
A typical rental with $12,000 of buying costs and two empty weeks a year.
You enter
- Property price
- $250,000.00
- Purchase costs
- $12,000.00
- Monthly rent
- $1,400.00
- Annual expenses
- $4,500.00
- Empty weeks per year
- 2 weeks
- Target gross yield
- 6%
You get
- Gross yield
- 6.2%
- Net yield
- 4.4%
- Net rental income per year
- $11,653.35
- Rent a month for the target yield
- $1,310.00
- Monthly rent gap to the target
- -$90.00
Total invested is $262,000. Two empty weeks cost $646.65 of rent, so the year collects $16,153.35, which is a gross yield of 6.2%. After $4,500 of expenses the net rental income is $11,653.35, a net yield of 4.4%, so running costs remove 1.7 points. The rent you entered is $90 a month above the $1,310 average needed for a 6% gross yield.
A $120,000 flat let at $850 a month
A cheaper property with higher costs as a share of the rent and four empty weeks.
You enter
- Property price
- $120,000.00
- Purchase costs
- $6,000.00
- Monthly rent
- $850.00
- Annual expenses
- $3,200.00
- Empty weeks per year
- 4 weeks
- Target gross yield
- 7%
You get
- Gross yield
- 7.5%
- Net yield
- 4.9%
- Net rental income per year
- $6,214.78
- Rent a month for the target yield
- $735.00
- Monthly rent gap to the target
- -$115.00
Total invested is $126,000. Four empty weeks cost $785.22, leaving $9,414.78 collected and a gross yield of 7.5%. Expenses of $3,200 leave $6,214.78 of net rental income, a net yield of 4.9%, so the running costs remove 2.5 points. A 7% gross yield needs $735 a month on average, which is $115 below the rent you entered, though the four empty weeks mean the headline rent has to stay above that average to collect it.
Guides that go with it
How Much House Can I Afford on My Salary?
You earn a steady salary. You want a house. Somewhere between those two facts sits a number you need to know before you talk to a lender, a seller, or a real estate agent: the top price you can realis…
How Much of Your Salary Should Go to Rent?
You can work out a defensible rent ceiling in about fifteen minutes with nothing more than your payslip and a calculator. By the end of this guide you will know your gross and take-home pay, the rent…
How Much Can You Save by Paying Off Debt Early?
Paying extra toward a loan feels good. But how much does it actually save? In about ten minutes, you can work out the real number for your own debt: how many months you would cut, how much interest yo…
Frequently asked questions
What is the difference between gross yield and net yield?
Gross yield is the rent collected in a year divided by what the property cost, including the buying costs. Net yield subtracts the expenses a landlord pays, such as service charge, insurance, maintenance, management and tax, before doing the same division. The gap between the two is how many percentage points the running costs remove.
Gross yield is the quick comparison between two properties; net yield is the one that shows what the property actually returns. A property with a high gross yield and a heavy service charge can be the worse of the two once the net figures are side by side.
Should yield be worked out on the price or on the total invested?
This calculator uses the total invested: the property price plus the purchase costs you enter, because taxes, legal fees and a survey are money the purchase consumed and cannot be spent again. That is also why the yield here is slightly lower than a calculation based on the price alone.
What the yield leaves out is the mortgage. Yields measure the property rather than your financing, so a cash purchase and a heavily borrowed purchase of the same property show the same yield here.
How do the empty weeks reduce the yield?
The calculator converts your monthly rent into a weekly figure by dividing by 4.33, multiplies that by the empty weeks you enter, and subtracts it from a year of rent. Two empty weeks on a rent of $1,400 a month remove about $647 from the year, which is rent that never arrives.
Only the rent stops during a void. The mortgage, the service charge and the insurance carry on, which is why every empty week costs more than the rent it fails to earn. Add the cost of finding a tenant to the annual expenses if you pay an agent for it.
What rent do I need to reach my target yield?
The target rent is the total invested multiplied by the target yield and divided by twelve. That gives the rent that has to be collected on average across the year. The gap line compares it with the monthly rent you entered.
Because it is an average over twelve months, a property with empty weeks needs a headline rent slightly above the target to collect that much. A target yield is also a gross figure: the rent still has to cover the expenses and the mortgage, so the same target in an area with high service charges is a different proposition.
Terms used here
Short, plain-language definitions of the words this calculator uses.