Rental yield calculator: gross, net and with a mortgage
Rental yield measures how much rent a property earns each year compared with what it cost. This rental yield calculator gives the gross yield (yearly rent ÷ price) and the net yield after vacancy, letting and repair fees, property tax, insurance and other running costs, with your purchase costs added to the price. Examples for the US, UK, India and Australia load the right currency and typical cost lines.
Because many people ask for a “rental yield calculator with mortgage”, an optional panel shows what is left after loan payments and the return on the cash you put in. Yield on its own ignores financing, so the two views answer different questions. Results are estimates from the numbers you enter, not investment advice.
How to use the Rental Yield Calculator
- Choose your Country to load local example figures and currency.
- Enter the Purchase price, the Rent a month, a Vacancy allowance and your Purchase costs.
- Fill in Running costs: management, repairs, tax, insurance and any service charge.
- Read the gross yield, net yield, net rent and payback in the result panel; the bar shows where the rent goes.
- Tick Include a mortgage to add the deposit, rate and term.
Rental Yield Calculator features
Gross and net together
The headline gross yield sits next to the net yield you actually keep.
Purchase costs included
Stamp duty, legal and agent fees raise the cash cost, so they are added to the price in the net yield.
Rent sensitivity
A five-row table shows both yields if rent is 20% lower to 20% higher.
Optional mortgage
Payment, cash left after the loan and return on your own cash, using the same loan formula as the site’s mortgage tools.
Local examples
US, UK, India and Australia defaults reflect each market’s usual costs.
Rental yield formula and worked example
Gross yield = yearly rent ÷ purchase price × 100 and Net yield = (rent collected − running costs) ÷ (price + purchase costs) × 100. Mortgage interest, income tax and capital spending are not running costs here.
Example: a $350,000 home lets for $2,400 a month, so yearly rent is $28,800 and the gross yield is 8.23%. With 5% vacancy the rent collected is $27,360. Management at 8% and repairs at 5% take $3,557, property tax $4,200 and insurance $1,500, leaving $18,103. Divided by the price plus 3% purchase costs ($360,500), the net yield is 5.02%, and it takes about 19.9 years of net rent to repay the cost.
With a 25% deposit and a 7%, 30-year loan the payment is $1,746.42 a month. After loan payments about −$2,854 is left each year on $98,000 of cash — a return of −2.91% before counting the capital you repay and any price growth.
| Measure | Formula | Example |
|---|---|---|
| Gross yield | Yearly rent ÷ price | 8.23% |
| Net rent | Rent collected − running costs | $18,103 |
| Net yield | Net rent ÷ (price + purchase costs) | 5.02% |
| Return on cash | Cash left after loan ÷ cash invested | −2.91% |
Reading yields sensibly
- Compare gross yields only when you know what each one leaves out; net yields are the fairer comparison between properties.
- High yields often come with higher vacancy, repair costs or risk, and low yields with expected price growth.
- Use realistic vacancy and repair allowances. A listing’s advertised yield usually ignores both.
- For a fuller picture that includes the value of the property, try the cap rate calculator, the gross rent multiplier calculator or the rental property cash flow calculator.
Rental Yield Calculator FAQ
How do you calculate rental yield?
Divide the yearly rent by the purchase price and multiply by 100 for the gross yield. For the net yield, subtract vacancy and running costs from the rent, then divide by the price plus purchase costs.
What is a good rental yield?
It varies by country and city. Gross yields of 5–8% are often seen as healthy in the UK and US, while Indian cities are frequently 2–4%. A good yield is one that covers your costs and loan after realistic vacancy.
What is the difference between gross and net rental yield?
Gross yield uses the full rent and the price only. Net yield deducts vacancy and running costs and counts purchase costs as part of what you paid, so it is always lower.
Does rental yield include the mortgage?
No. Yield compares income with the property’s cost, whatever the financing. The optional panel here shows cash left after loan payments separately.
How do I calculate rental yield in India?
Use the same formula: yearly rent ÷ price. Choose India for rupee examples, and put society maintenance and property tax in the cost boxes and stamp duty plus registration in purchase costs.
Is this rental yield calculator financial advice?
No. It applies standard formulas to the figures you enter. Check costs, taxes and rules with a qualified adviser before buying.