Calculate rental yield

Compare gross rent yield, net operating yield, and acquisition-cost-adjusted cap rate for one rental property.

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ToolRental Yield Calculator
Input
Output
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How it works

Gross yield divides 12 monthly rents by purchase price, while net yield first removes annual running costs. Cap rate uses the same net income but divides by price plus stamp duty, legal fees, survey, and other purchase costs; both cost fields default to 0 rather than inventing expenses.

Formula
gross yield = annual rent ÷ property price × 100
cap rate = (annual rent − annual costs) ÷ (price + purchase costs) × 100
  • Mortgage finance is excluded, making these unlevered property measures.
  • A negative net operating income remains negative in both net yield and cap rate.

Worked example

A 200,000 flat let at 1,000 a month
With 1,500 a year running costs and 8,000 in buying costs
Input
											Property price: 200000
Monthly rent: 1000
Annual costs: 1500
Purchase costs: 8000
Output
												Annual rent: 12000
Gross yield percent: 6
Net annual income: 10500
Net yield percent: 5.25
Cap rate percent: 5.05

When to use this

Buy-to-let screening, landlord annual reviews, and acquisition models compare advertised rent with maintenance, insurance, management, and completion costs.

Edge cases

  • Annual costs above annual rent produce negative net yield and cap rate rather than being clamped to 0.
  • Purchase costs reduce cap rate but do not alter gross or net yield, because those denominators use price alone.
  • Mortgage payments are not accepted as annual costs, so the result is an unlevered property measure rather than cash-on-cash return.