Gross yield uses rent before expenses — a quick screen, not a full return.
Calculation details
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Use this result
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What does this calculator estimate?
Gross rental yield is the annual rent a property generates as a percentage of its price — a quick, financing-free snapshot of a property's income potential. Enter the property value and monthly rent to see the gross yield.
- Gross yield = annual rent ÷ property value
- Uses rent before operating costs and mortgage
- A quick comparator, not a profit figure
What gross yield tells you
Gross yield is the rent-to-price ratio — the quickest way to screen markets and properties. Higher yields mean more rent per dollar of price, which usually signals affordability (or risk). It ignores all costs, so it's a screen, not a full return.
Limitations to watch for
Gross yield doesn't account for expenses, vacancy, or financing — the net yield and cash-on-cash do. Markets with high yields often have weaker appreciation or higher costs. Use it to shortlist, then run the full numbers.
How to use it in practice
Divide annual rent by price for each candidate and rank them. Compare against the market's typical range (5–8% is common in the US). Run the full cash-flow and ROI numbers on the shortlist.
['Enter the property price.', 'Enter the monthly rent.', 'Read the gross rental yield.']
What rental yield measures
Rental yield is annual rent divided by property value: $24,000 rent on a $300,000 property is 8 percent gross yield. It is the quickest measure of a rental's income return, before expenses and financing.
Gross vs. net yield
Gross yield uses total rent; net yield subtracts operating expenses (taxes, insurance, maintenance, management). A property at 8 percent gross may net 5–6 percent after expenses. The calculator shows both so the comparison is honest.
The 1% rule connection
Gross yield of 12 percent equals the 1 percent rule (monthly rent of 1 percent of price). Most markets deliver 5–10 percent gross; the calculator converts any rent and price into the yield and its rule-of-thumb reading.
A worked example
A $280,000 condo renting $1,600 monthly: gross yield = 19,200 ÷ 280,000 = 6.9 percent. With $450 monthly expenses, net yield drops to about 4.9 percent. The calculator returns both numbers.
Yield vs. total return
Yield ignores appreciation and principal paydown. A 6 percent yield plus 3 percent appreciation and paydown is a 9+ percent total return. Use yield to compare income; add the other components for the full picture.
How this calculator works
Formula
Gross rental yield = annual rent ÷ property price × 100. It's the rent-to-price ratio before expenses and financing.
Worked example
$2,000/month rent ($24,000/year) on a $300,000 property: 8.0% gross yield.
Assumptions to verify
- Rent is at market rate.
- No vacancy or expenses are modeled.
- The price is the purchase price.
Frequently asked questions
What is rental yield?
Annual rent divided by property price: $24,000 ÷ $300,000 = 8%.
How is it calculated?
Monthly rent × 12 ÷ price × 100.
What is a good rental yield?
5–8% is common in the US; higher in cheaper markets, lower in expensive coastal cities.
Gross or net?
This is gross — before expenses. Net yield subtracts operating costs; cash-on-cash includes financing.
Why are yields higher in some cities?
Lower prices relative to rents — often weaker appreciation or higher perceived risk.
How do I use it to compare?
Rank candidates by yield first, then run full cash-flow numbers on the top ones.
Is high yield always good?
No — it can flag high costs, weak demand, or rough areas. Combine with other metrics.
How do I calculate it?
Monthly rent × 12 ÷ property price.
What is the difference between gross and net yield?
Net subtracts operating expenses from the rent before dividing.
What is a good yield?
5–10% gross is common; the target depends on market and risk.
Cite this tool
BoringToolsKit. “Rental Yield Calculator.” boringtoolskit.com/rental-yield-calculator/ (reviewed 2026-08-25). Free to reference in articles, syllabi, and answer posts with a link.
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