Rental yield calculator
Work out the gross and net rental yield of a buy-to-let property. Enter the price, the rent and your running costs to see what the property really returns.
Results
- Gross yield
- 6.00%
- Net yield
- 4.47%
- Annual rent (fully let)
- £15,000
- Rent collected after voids
- £14,423
- Total annual costs
- £3,242
- Net annual income
- £11,181
- Net monthly income
- £932
How to calculate rental yield
Gross rental yield
Gross yield is the annual rent as a percentage of the property's price: gross yield = (monthly rent × 12) ÷ property price × 100. A £250,000 flat let at £1,250 a month earns £15,000 a year, a gross yield of 6%.
Net rental yield
Net yield takes off the costs of owning and letting the property, and allows for empty periods: net yield = (rent collected − annual costs) ÷ property price × 100. With two empty weeks, a 10% management fee and £1,800 of other costs, the same flat returns about £11,180 a year, a net yield of roughly 4.5%.
Which costs to include
Letting and management fees, landlord insurance, repairs and maintenance, service charge and ground rent for leasehold flats, safety certificates such as gas safety and EICR, and any bills you pay. Mortgage interest and tax aren't included in net yield, because they depend on how the property is financed and owned.
What is a good rental yield?
It depends on your strategy and the area. Higher-yielding areas often see slower capital growth, and lower yields in expensive areas may be balanced by stronger price growth. Compare net yields rather than gross, because costs vary widely between properties.
Track yield across your whole portfolio
PropManager calculates gross and net yield, net operating income and capital growth for every unit and property automatically, from your actual rents and costs.
Track the yield of every property, automatically.
Free for up to 5 units. No card required for the Pro trial.