# Rental Yield Calculator

**Enter all**** values to calculate:**

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## What is Rental Yield?

Rental yield is the return an investor is likely to receive on a property through rent.

It is the rate or the percentage of returns from the rental income.

Ideally, 7% or more is considered as a good rental yield.

## Vacancy Rate Table:

Vacant Month | Vacancy Rate |

1 | 0.083 |

2 | 0.166 |

3 | 0.25 |

4 | 0.33 |

5 | 0.416 |

6 | 0.5 |

7 | 0.583 |

8 | 0.66 |

9 | 0.75 |

10 | 0.833 |

11 | 0.916 |

12 | 1 |

## Rental Yield Formula:

There are two values to be calculated in Rental Yield.

- Gross rental yield = annual rental income/ property value x 100
- Net rental yield = [Annual rental income* (1 – Vacancy Rate)] – Annual maintenance / Total property cost x 100

**Example:**

If the Property value is **$450000** which receives annual rent of **$21,000** and has an annual maintenance of **$1000**. What is the Gross rental yield ?

Gross rental yield = annual rental income/ property value x 100

Here,

Gross rental yield = $21,000/ $450000 x 100 = 4.667%

Gross rental yield would be **4.667**%

If the Property value is **$450000** which receives annual rent of **$21,000** and has an annual maintenance of **$1000** and is vacant for one month in a year. What is the Net rental yield ?

Here, Vacancy rate = number of vacant months / 12 = 1/12 = 0.0833

Net rental yield = [Annual rental income x (1 – Vacancy Rate)] – Annual maintenance / Total property cost x 100

Net rental yield = $21,000 x (1 -0.0833) – $1000 / $450000 x 100 = 4.0557%

Net rental yield would be **4.0557**%