A rental yield calculator helps property investors measure the annual return generated by a rental property relative to its purchase price. Gross yield gives you a quick snapshot, while net yield factors in all operating expenses to reveal your true return on investment. Understanding both figures — along with cap rate and cash flow — is essential before committing capital to any investment property.
Property Details
Annual Operating Expenses
= $0/yr lost to vacancy
How to Use the Rental Yield Calculator
Whether you are evaluating your first investment property or comparing options in a portfolio, knowing your rental yield is the foundation of every smart property decision. This free calculator gives you gross yield, net yield, cap rate, and cash flow in seconds — all without a spreadsheet.
Step 1: Enter the Property Purchase Price
Start with the total price you paid (or plan to pay) for the property, including any purchase costs if desired. This is the denominator in the yield calculation. The higher the purchase price relative to rent, the lower your yield — which is why location and pricing matter so much in property investment.
Step 2: Enter the Monthly Rent
Enter the monthly rent you charge (or expect to charge) tenants. The calculator multiplies this by 12 to get your gross annual rent income. If the property is not yet rented, use a realistic market rate based on comparable properties in the area. Overestimating rent is one of the most common mistakes first-time investors make.
Step 3: Add Your Annual Operating Expenses
This is where gross yield and net rental yield diverge. Enter your annual insurance premium (typically 0.5–1% of property value), maintenance and repair budget (a common rule of thumb is 1% of property value per year), annual property tax, and property management fees if you use a manager (usually 8–12% of monthly rent). These four categories cover the majority of recurring rental property costs.
Step 4: Set the Vacancy Rate
Vacancy rate accounts for the time a property sits empty between tenants. A realistic vacancy allowance is 5–8% for most markets, which equates to roughly three to four weeks of lost rent per year. Entering a vacancy rate reduces your effective income and gives you a more conservative, realistic yield figure. The calculator shows you the exact dollar amount of income lost to vacancy.
Step 5: Analyse Your Results
After clicking Calculate, review the four headline metrics. Gross yield shows your return before expenses — useful for a quick comparison between properties. Net yield is the most important figure — it reflects your actual return after all costs. Cap rate is the net operating income divided by property value, widely used by professional investors. Cash flow is the money left over each month after all expenses (not including mortgage payments). The detailed breakdown table shows every line item monthly and annually so nothing is hidden. The benchmark section tells you how your net yield compares to typical investment property thresholds.
For a detailed walkthrough, see our guide: Rental Property Cash Flow Analysis.
FAQ
Is this rental yield calculator free?
Yes, this rental yield calculator is completely free with no signup, no hidden fees, and no limits. You can calculate yield for as many properties as you like. Everything runs locally in your browser, so your financial data stays completely private.
Is my property data safe?
Absolutely. All calculations run entirely in your browser using client-side JavaScript. Your property details and financial figures are never sent to any server or stored anywhere. You can even disconnect from the internet and the calculator will continue working perfectly.
What is the difference between gross yield and net yield?
Gross yield is calculated using annual rent divided by the property price, ignoring all expenses. Net yield subtracts annual operating expenses — insurance, maintenance, property tax, management fees, and vacancy — from the annual rent before dividing by the property price. Net yield gives you a much more realistic picture of your actual return on investment.
What is a good rental yield?
A good rental yield varies by market. In high-demand urban areas, a gross yield of 4–6% is often considered solid. In lower-cost regional markets, 7–10% or higher is achievable. Net yield should ideally be at least 3–5% to comfortably cover costs after expenses. Always compare net yield — not just gross — when evaluating properties.
What is cap rate and how is it different from rental yield?
Cap rate (capitalization rate) measures the net operating income as a percentage of the property value, similar to net yield but calculated before financing costs. It is widely used by investors to compare properties regardless of how they are financed. Rental yield typically factors in the purchase price you paid, while cap rate is often applied to current market value.
How does vacancy rate affect my rental return?
Vacancy rate accounts for periods when the property is unoccupied between tenants. For example, a 5% vacancy rate on a $24,000 annual rent reduces effective income by $1,200. Over time, even a modest vacancy rate significantly impacts your net return, which is why it is included as an expense input in this calculator.
Should I include mortgage payments in rental yield?
Traditional rental yield and cap rate calculations do not include mortgage payments — they measure the property's return independent of financing. Cash flow, however, does include your mortgage payment. To get your true after-financing cash flow, subtract your monthly mortgage payment from the monthly cash flow shown. Use our Mortgage Calculator to estimate your mortgage costs.
What expenses should I include in my rental property calculation?
The most common rental property expenses are insurance (typically 0.5–1% of property value annually), maintenance and repairs (budget 1% of property value per year), property management fees (8–12% of monthly rent if using a manager), property taxes (varies by location), and vacancy allowance (typically 5–10% of annual rent). Including all of these gives you the most accurate net yield.