Rental Yield Calculator
Updated on 22 Oct 2026 · Checked by Aotob
At $2,000 a month on a $300,000 property, the net yield is 5.33% (8% gross).
With a 25% deposit and a 6.5% mortgage over 25 years, cash flow is −$143 a month before income tax.
Net yield
5.33%
The rent doesn’t cover the mortgage and costs: you would top it up by $143 a month and rely on the price rising.
Show the working
Gross yield = 24,000 ÷ 300,000 = 8%
Net income = 24,000 − 5% empty − 2,280 management − 4,000 costs = 16,520
Net yield = 16,520 ÷ 310,000 = 5.33%
Where the rent goes, a year
| Item | Amount |
|---|---|
| Rent if always let | 24,000 |
| Less empty periods | −1,200 |
| Less management | −2,280 |
| Less running costs | −4,000 |
| Net operating income | 16,520 |
| Less mortgage | −18,231 |
| Cash flow | -1,711 |
Questions people ask
What is a good rental yield?
Gross yields of 5% to 8% are common; net yields after costs are usually 2 to 3 points lower. Cheaper areas tend to yield more but grow in value less.
Gross or net yield?
Gross yield is a year’s rent divided by the price, good for comparing listings. Net yield takes off empty periods, management and running costs and adds buying costs to the price, so it shows what the property really earns.
What is cash-on-cash return?
Your yearly cash flow after the mortgage divided by the cash you put in: the deposit plus buying costs. It shows the return on your own money.
Updated 22 Oct 2026Source: Standard yield and cash flow formulasChecked by AotobBefore income tax. Mortgage is a 25-year repayment loan. Prices and rents change.Report an issue