How to Calculate Rental Yield
What is Rental Yield?
Rental yield measures the annual rental income as a percentage of a property's value. Gross yield ignores costs; net yield subtracts running costs. Most buy-to-let investors target 5–8% gross yield, though net yield of 3–5% is more realistic after expenses.
Formula
Step-by-Step Guide
- 1Gross yield = (Annual rent / Property value) × 100
- 2Annual rent = Monthly rent × 12
- 3Net yield = ((Annual rent − Annual expenses) / Property value) × 100
- 4Annual expenses include: insurance, maintenance, letting agent fees (8–15%), void periods
Worked Examples
Frequently Asked Questions
What is Rental Yield?
Rental yield measures the annual rental income as a percentage of a property\. Use this calculator for accurate, instant results.
How accurate is the Rental Yield calculator?
The calculator uses the standard published formula for rental yield. Results are accurate to the precision of the inputs you provide. For financial, medical, or legal decisions, always verify with a qualified professional.
What units does the Rental Yield calculator use?
This calculator works with inches, percentages. You can enter values in the units shown — the calculator handles all conversions internally.
What formula does the Rental Yield calculator use?
The core formula is: Gross yield = (Annual rent / Property value) × 100. Each step in the calculation is shown so you can verify the result manually.
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