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Rental Yield Calculator
Enter the rent you expect and the costs you will actually pay. Net yield uses vacancy, operating costs and property tax, which is the number that survives a real tenancy.
Rents, costs and letting rules are local. Treat the output as a scenario and check the assumptions against local listings and advice.
Gross is marketing, net is cash
Gross yield divides a year of rent by the price and ignores everything between the tenant and the owner. It is useful for a first sort of listings, but it is not the return a buyer receives.
Net yield deducts vacancy, operating costs and property tax. Those lines are what turn a headline figure into a budget, and they are the ones a seller is least likely to mention.
Vacancy is a cost
An empty month is lost rent plus fixed costs that continue. Entering a realistic vacancy rate, based on local listings and seasonality, is more honest than assuming full occupancy from day one.
One-off setup costs such as furniture and repairs are not in this annual figure. Add them separately when comparing a rental purchase with another use of the money.
Frequently asked questions
Does net yield include income tax on the rent?
No. It deducts operating costs and property tax. Income tax depends on residence and the ownership structure, so model it separately.
What vacancy rate should you use?
Use local evidence for the property type and season. A common starting point is a month or two per year, but the right figure comes from the market you are buying into.
Are management fees included?
Only if you enter them in annual operating costs. Add management, insurance, maintenance and any local letting fee you expect to pay.