Rental Yield Calculator — Return After Interest
Annual rental yield on invested cash, with loan interest and a gross-yield comparison
Runs in your browser · nothing is uploaded
Updated 2026-10-04What you pay for the property.
Rent received per month.
The tenant deposit. It reduces the cash you put in. Leave blank for none.
Mortgage principal used for the purchase. Leave blank for none.
Calculated as an interest-only loan for simplicity.
Rental yield result
Enter the price and monthly rent to see the annual yield. Deposit and loan are optional.
For reference only. Purchase taxes and agent fees, repairs, vacancy, property taxes, tax on rental income and loan principal repayment are not included, so the real yield can be lower. Amounts are calculated the same way in any currency.
What it is
When you look at an income property, the first number most people check is the rental yield. This rental yield calculator takes the purchase price and the monthly rent, plus an optional deposit and loan, and returns the annual net income after loan interest and the yield on the cash you actually invest. It also shows the gross yield before interest, so you can see at a glance whether the loan helps or hurts your return. It is handy for putting several properties on the same footing. Everything is calculated in your browser.
How to use
- Enter the purchase price and the monthly rent.
- Add the tenant deposit you receive, if any.
- If you borrow, enter the loan amount and the yearly interest rate.
- Read the annual rent, annual loan interest, annual net income and the cash invested.
- Compare the yield with the gross yield.
How it works
- Annual rent = monthly rent × 12.
- Annual loan interest = loan amount × yearly rate, treated as an interest-only loan for simplicity.
- Annual net income = annual rent − annual loan interest.
- Cash invested = price − deposit − loan. If this is zero or less, no result is shown.
- Yield = annual net income ÷ cash invested.
- Gross yield = annual rent ÷ (price − deposit), with no interest deducted.
- Amounts are computed as whole numbers, and the yield is divided out only once at the end.
Examples
| Price | Deposit | Monthly rent | Loan (rate) | Cash invested | Net income | Yield |
|---|---|---|---|---|---|---|
| 500M | 50M | 1.5M | 200M (4%) | 250M | 10,000,000 | 4% |
| 500M | 50M | 1.5M | none | 450M | 18,000,000 | 4% |
| 500M | 50M | 1.5M | 200M (10%) | 250M | −2,000,000 | −0.8% |
When the loan rate equals the gross yield of 4%, borrowing does not change the yield, and a higher rate pulls it down.
Common mistakes
Using the whole price as the investment ignores the deposit and makes the yield look lower than it is. Ignoring loan interest does the opposite and overstates the yield. Loan principal repayment builds equity rather than costing you income, so only the interest counts here. Purchase taxes, agent fees, vacancy and property taxes are not included, so the real yield can be lower. When you compare properties, run each one with the same assumptions.
FAQ
How is rental yield calculated here?
Annual yield = (annual rent − annual loan interest) ÷ (price − deposit − loan). The denominator is the cash you actually put in. For a 500M purchase with a 50M deposit, 1.5M monthly rent and a 200M loan at 4%, the yield is 4%.
Why is the deposit subtracted from the investment?
The tenant deposit is not your money, but it helps fund the purchase. The cash you really contribute is the price minus the deposit and the loan.
What is the difference between gross yield and yield?
Gross yield divides annual rent by the price minus the deposit, before any loan interest. The yield divides net income after interest by the cash you actually invest.
What if loan interest is higher than the rent?
Annual net income turns negative, so the yield is negative too, and a note appears under the result.
Are taxes and repairs included?
No. Purchase taxes and agent fees, repairs, vacancy, property taxes, tax on rental income and loan principal repayment are not included, so the real yield can be lower.
