How to Calculate Rental Yield (and What Counts as Good)

Rental yield measures the annual rental income a property generates as a percentage of its value. It lets investors compare very different properties on a single, consistent metric.

Gross vs net yield

Gross yield uses annual rent divided by property value. Net yield subtracts operating costs first, giving a more realistic picture of what you keep.

• Gross yield = (annual rent / property value) x 100
• Net yield = ((annual rent - annual costs) / property value) x 100
• Always compare net yield against local benchmarks

What counts as a good yield

A good yield depends heavily on the market. In high-growth cities, lower yields may be acceptable if capital appreciation is strong. In slower markets, investors often demand higher yields to compensate.

Use our Rental Yield Calculator to run the numbers on any property in seconds.