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Rental Yield Calculator

Compute gross and net rental yield on a buy-to-let — properly accounting for voids, agent fees, maintenance, insurance, and ground rent. The honest number that pays your bills.

Last reviewed:

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Gross yield is the headline number that property listings and agents quote — annual rent as a percentage of price. Net yield is the number that pays your bills: rent minus voids, agent fees, maintenance, insurance, ground rent and the running costs that landlords actually face. The gap between them is usually 1.5–3 percentage points.

Enter the property price plus realistic acquisition costs (transfer / stamp duty, legal, broker, survey). Add the monthly rent and the costs of running the property: agent fees as a percentage, maintenance as a $ figure (1% of value is a common rule of thumb), insurance, ground rent / service charge if leasehold, and any other annual costs (HOA dues, certificates, accountancy). Voids are typically 2–4 weeks per year — don't model 0 unless you've done it for several years already.

Examples

$250k property, $1,400/month, 10% agent fee, 2-week void

Annual rent $16,800. Effective $16,154 after voids. Running costs ≈ $3,165 (agent $1,615 + maint $1,200 + insurance $350). Net $12,989. Gross yield 6.7%, net yield 5.0% on $258k total acquisition cost.

Self-managed, no voids, leasehold / condo with HOA

Removing the agent fee adds back ~$1,600/year. Adding $1,800 service charge / HOA on a leasehold flat or condo removes ~$1,800. The two roughly cancel, but the net yield difference between freehold houses and managed buildings is real and structural.

Frequently Asked Questions

What is a "good" net yield?
As of 2026, 5–6% net is solid for a stabilised single-let in most mature markets. Below 4% and you are betting on capital appreciation. Above 8% net usually means HMO / multi-let, secondary cities, or higher-risk tenant profiles — investigate why.
Should I include the mortgage in net yield?
No. Yield measures the property; cash-on-cash return measures the deal. Mixing them obscures whether a low yield is a leverage problem or a property problem. Compute yield first, then layer on the mortgage cost separately to get cash-on-cash.
Why use total acquisition cost in the net yield denominator?
A $250k property that costs $258k after closing costs has $258k of capital tied up. Using only the $250k headline overstates yield by ~3%. Total acquisition cost is the honest denominator.
What void weeks should I assume?
2 weeks is optimistic for a stabilised property in a strong market, 4 weeks is more typical, 6+ weeks for student-let or seasonal areas. New-build flats with high stock churn tend toward the higher end. Voids also include re-letting downtime, not just unhappy tenants leaving.

References

  1. IRS — Tips on Rental Real Estate Income, Deductions and Recordkeeping — https://www.irs.gov/businesses/small-businesses-self-employed/tips-on-rental-real-estate-income-deductions-and-recordkeeping
  2. UK government — Renting out your property landlord overview — https://www.gov.uk/renting-out-a-property
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Quick Tips

Double check your inputs. Ensure units match (e.g., inches vs cm).

Did you know?
Calculators are estimates. Consult professionals for critical decisions.

Gross yield is the headline number that property listings and agents quote — annual rent as a percentage of price. Net yield is the number that pays your bills: rent minus voids, agent fees, maintenance, insurance, ground rent and the running costs that landlords actually face. The gap between them is usually 1.5–3 percentage points.

How to Use This Calculator

Enter the property price plus realistic acquisition costs (transfer / stamp duty, legal, broker, survey). Add the monthly rent and the costs of running the property: agent fees as a percentage, maintenance as a $ figure (1% of value is a common rule of thumb), insurance, ground rent / service charge if leasehold, and any other annual costs (HOA dues, certificates, accountancy). Voids are typically 2–4 weeks per year — don't model 0 unless you've done it for several years already.

Understanding the Formula

Gross yield = (monthly rent × 12) / property price. Net yield = (effective rent − running costs) / (property price + acquisition costs), where effective rent = annual rent × (1 − void weeks/52) and running costs include agent fees, maintenance, insurance, ground rent / service charge and other annual costs.

Examples

$250k property, $1,400/month, 10% agent fee, 2-week void

Annual rent $16,800. Effective $16,154 after voids. Running costs ≈ $3,165 (agent $1,615 + maint $1,200 + insurance $350). Net $12,989. Gross yield 6.7%, net yield 5.0% on $258k total acquisition cost.

Self-managed, no voids, leasehold / condo with HOA

Removing the agent fee adds back ~$1,600/year. Adding $1,800 service charge / HOA on a leasehold flat or condo removes ~$1,800. The two roughly cancel, but the net yield difference between freehold houses and managed buildings is real and structural.

Frequently Asked Questions

What is a "good" net yield?

As of 2026, 5–6% net is solid for a stabilised single-let in most mature markets. Below 4% and you are betting on capital appreciation. Above 8% net usually means HMO / multi-let, secondary cities, or higher-risk tenant profiles — investigate why.

Should I include the mortgage in net yield?

No. Yield measures the property; cash-on-cash return measures the deal. Mixing them obscures whether a low yield is a leverage problem or a property problem. Compute yield first, then layer on the mortgage cost separately to get cash-on-cash.

Why use total acquisition cost in the net yield denominator?

A $250k property that costs $258k after closing costs has $258k of capital tied up. Using only the $250k headline overstates yield by ~3%. Total acquisition cost is the honest denominator.

What void weeks should I assume?

2 weeks is optimistic for a stabilised property in a strong market, 4 weeks is more typical, 6+ weeks for student-let or seasonal areas. New-build flats with high stock churn tend toward the higher end. Voids also include re-letting downtime, not just unhappy tenants leaving.

Assumptions & Limitations

  • Mortgage interest is excluded — yield measures the property, not the leverage. Cash-on-cash return on a leveraged purchase is a separate calculation.
  • Capital appreciation is ignored. Yield is the income return only; total return = yield + capital growth.
  • Voids are applied as a fraction of the year, not modelled as a sequence of empty months.
  • Tax is excluded. Rental income is taxable in most jurisdictions; net yield is pre-tax.
  • Maintenance is a single annual figure rather than lumpy capex (boiler, roof). Smooth your reserve over 5–10 years to get a realistic number.

References

  1. IRS — Tips on Rental Real Estate Income, Deductions and Recordkeeping — https://www.irs.gov/businesses/small-businesses-self-employed/tips-on-rental-real-estate-income-deductions-and-recordkeeping
  2. UK government — Renting out your property landlord overview — https://www.gov.uk/renting-out-a-property