Rental Yield Calculator
Rental yield measures a property's income return relative to its price, and it's an essential metric for comparing investment properties on a like-for-like basis. Gross yield is the simplest version: annual rent divided by the property price, with no adjustment for costs. Net yield is the more meaningful number because it subtracts operating expenses — property taxes, insurance, maintenance, HOA fees, property management, and a vacancy reserve — to show the true income return you actually keep. This calculator shows both yields plus the annual net operating income, so you can judge whether a property's income justifies its price. Enter the property purchase price, the monthly rent, and the monthly operating expenses, and the calculator returns the gross yield, the net yield, and the annual net operating income. Above 6% net yield is generally solid in most U.S. markets, though high-cost cities may yield only 3% to 4% while lower-cost areas can exceed 8% to 10%, so compare yields within similar markets rather than across very different ones. When entering expenses, include property taxes, insurance, maintenance, HOA fees, property management, and a vacancy reserve, but exclude the mortgage — that's financing, not an operating expense. Rental yield is closely related to cap rate (net operating income divided by property value), which is essentially the same as net yield and is the more common term among investors. Don't rely on yield alone, because total return also includes appreciation and loan paydown: a low-yield property in an appreciating area can outperform a high-yield one over time, so weigh income, appreciation, and financing together when evaluating a deal.
Rental Yield Calculator
Calculate gross and net rental yield to evaluate a rental property.
Net rental yield
6.4%
Annual NOI ÷ price
Gross rental yield
8.8%
Annual net operating income
$19,200
Net yield is the more meaningful number because it accounts for operating expenses. A net yield above 6% is generally considered solid in most U.S. markets; compare against cap rates in your area.
How to Use This Calculator
- 1Enter the property purchase price.
- 2Enter the monthly rent.
- 3Enter the monthly operating expenses.
- 4Read the gross and net rental yield.
Why It Helps
- ✓Compares properties on income return.
- ✓Shows net yield after expenses.
- ✓Helps spot overpriced rentals.
- ✓Useful alongside cap rate analysis.
About This Calculator
Rental yield measures a property's income return relative to its price, and it's an essential metric for comparing investment properties on a like-for-like basis. Gross yield is the simplest version: annual rent divided by the property price, with no adjustment for costs. Net yield is the more meaningful number because it subtracts operating expenses — property taxes, insurance, maintenance, HOA fees, property management, and a vacancy reserve — to show the true income return you actually keep. This calculator shows both yields plus the annual net operating income, so you can judge whether a property's income justifies its price. Enter the property purchase price, the monthly rent, and the monthly operating expenses, and the calculator returns the gross yield, the net yield, and the annual net operating income. Above 6% net yield is generally solid in most U.S. markets, though high-cost cities may yield only 3% to 4% while lower-cost areas can exceed 8% to 10%, so compare yields within similar markets rather than across very different ones. When entering expenses, include property taxes, insurance, maintenance, HOA fees, property management, and a vacancy reserve, but exclude the mortgage — that's financing, not an operating expense. Rental yield is closely related to cap rate (net operating income divided by property value), which is essentially the same as net yield and is the more common term among investors. Don't rely on yield alone, because total return also includes appreciation and loan paydown: a low-yield property in an appreciating area can outperform a high-yield one over time, so weigh income, appreciation, and financing together when evaluating a deal.
Disclaimer: This calculator provides estimates for educational purposes only and does not constitute financial, tax, or investment advice. Results depend on assumptions that may not reflect your actual situation.
Frequently Asked Questions
What is a good net rental yield?
Above 6% is generally solid in most U.S. markets. High-cost cities may yield 3-4%, while lower-cost areas can exceed 8-10%.
What is the difference between gross and net yield?
Gross yield ignores expenses; net yield subtracts operating costs. Net yield is the more realistic measure of income return.
What expenses should I include?
Property taxes, insurance, maintenance, HOA fees, property management, and a vacancy reserve. Exclude the mortgage — that is financing, not operating.
Is rental yield the same as cap rate?
They are similar. Cap rate is net operating income divided by property value — essentially the same as net yield. Cap rate is the more common term among investors.
Should I rely only on yield?
No. Total return also includes appreciation and loan paydown. A low-yield property in an appreciating area can outperform a high-yield one.
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Written by
James MitchellSenior Financial Analyst & Personal Finance Expert
Certified Financial Planner (CFP) • MBA in Finance, University of Chicago Booth School of Business