Rental Yield Calculator
Calculate the gross rental yield of a property to evaluate its performance as a rental investment. Compare property price against monthly rent income.
Calculation Results
Total gross rent received in one year.
The gross yearly return on your property purchase price.
How This Calculator Works
To calculate gross yield on a rental property:
- Enter the total purchase price of the property.
- Enter the estimated or current monthly rent amount.
The calculator displays the annual rental income and gross yield percentage immediately.
Formula & Calculations
Gross rental yield is computed using annual rental income divided by the total property purchase price:
Annual Rental Income = Monthly Rent × 12
Gross Rental Yield = (Annual Rental Income / Property Purchase Price) × 100
Step-by-Step Calculation Examples
Typical Single-Family Rental
Calculating the gross rental yield for a house purchased for $250,000 renting at $1,800 per month.
- property_price: 250000
- monthly_rent: 1800
- annual_income: $21,600.00
- gross_yield: 8.64%
Frequently Asked Questions
What is a good rental yield?
Typically, a gross rental yield between 5% and 8% is considered good in most urban markets. In high-demand cities, yield may be lower (3% to 4%) due to high property values, while rural or secondary markets might offer 10% or more.
What is the difference between gross yield and net yield?
Gross yield only considers rent income and the property price, ignoring costs. Net yield subtracts all ownership expenses (property taxes, insurance, maintenance, vacancies, management fees) before dividing by the property price, providing a more accurate reflection of profitability.
Does rental yield take financing into account?
No. Rental yield calculates the return based on the total value of the asset as if it were bought in cash. To analyze returns based on a mortgage, investors look at the Cash-on-Cash Return.