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Abodewise

Rental Yield Calculator

Use this rental yield calculator to estimate gross yield, net yield and a simple net cashflow figure. Enter your rent and costs, then choose whether to base yield on your purchase cost or the property’s current value.

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Yield based on
Gross yield
5.76%
Net yield
5.16%
Annual rent£14,400.00
Annual costs£1,500.00
Monthly net cashflow£1,075.00
Gross yield uses rent only. Net yield and net cashflow subtract your costs (including the mortgage payment, if entered).
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How this rental yield calculator works

This calculator estimates your rental yield and a simple net cashflow figure using your rent, costs, and (optional) mortgage payment.

  • Gross yield: annual rent divided by the base value (purchase cost or current value).
  • Net yield: annual rent minus annual costs (including the mortgage payment), divided by the base value.
  • Monthly net cashflow: monthly rent minus monthly costs and the monthly mortgage payment.

This is an estimate. It does not include taxes, voids, or one-off costs unless you include them in “annual costs”.

Example model (default scenario)
This shows the default scenario when the page loads. It stays the same as a quick sanity check.
BasePurchase cost
Monthly rent£1,200.00
Annual costs£1,500.00
Gross yield5.76%
Net yield5.16%
Monthly net cashflow£1,075.00
Important

This calculator provides a simplified estimate for typical UK rentals. It’s not financial or tax advice.

It does not account for income tax, mortgage interest relief rules, capital growth, void periods, arrears, or large repairs.
How it works

This calculator estimates gross yield and net yield, plus a simple monthly net cashflow figure, using the rent and costs you enter.

  • Gross yield is based on annual rent divided by the chosen base value.
  • Net yield subtracts annual costs (and optional mortgage payments) before dividing by the base value.

You can choose whether the base value is your purchase cost (purchase price + buying costs) or the current value.

Rates and thresholds

Last verified: 05/03/2026. There are no official yield thresholds built into this tool.

Because “good yield” depends on costs, finance, and risk, this page doesn’t label a yield as good/bad. Instead, it helps you test:

  • how sensitive yield is to buying costs (stamp duty, legals, refurb)
  • how sensitive cashflow is to mortgage payments and ongoing costs
Worked examples

Worked examples using the calculator’s logic (rounded):

Example 1 — Purchase cost base

  • Purchase price £250,000; buying costs £0 → base value £250,000
  • Rent £1,200/month → annual rent £14,400
  • Annual costs £1,500; no mortgage payment
  • Gross yield: 5.76%; net yield: 5.16%
  • Monthly net cashflow: £1,075

Example 2 — Buying costs reduce yield

  • Same rent/costs, but buying costs £10,000 → base value £260,000
  • Gross yield: 5.54%; net yield: 4.96%

Example 3 — Current value base with mortgage payment as a cost

  • Current value £300,000; rent £1,500/month; annual costs £2,500; mortgage payment £900/month
  • Gross yield: 6.00%; net yield: 1.57%
  • Monthly net cashflow: £392
Edge cases and exclusions
  • Tax excluded: income tax and mortgage interest restriction are not included.
  • Void periods: if your property is empty for part of the year, yield and cashflow fall.
  • One-off costs: refurb and large repairs can distort a single-year “net yield”.
  • Mortgage payments vs interest: this uses your payment input as a cash cost; it doesn’t split interest/principal.
  • Base value choice: purchase cost vs current value can change yield interpretation.
Assumptions
  • This is a simplified estimate based on the numbers you enter.
  • “Annual costs” can include repairs, insurance, agent fees, service charges, and similar running costs.
  • If you enter a mortgage payment, it is treated as a cost for net yield and cashflow.
  • It does not include income tax, void periods, arrears, or one-off costs unless you include them.
Methodology

Base value is either purchase price + buying costs, or the current property value.

Gross yield = annual rent ÷ base value.

Net yield = (annual rent − annual costs − annual mortgage payments) ÷ base value.

Monthly net cashflow = (annual rent − annual costs − annual mortgage payments) ÷ 12.

What to do next
FAQ
What is the difference between “purchase cost” and “current value” as the yield base?
Purchase cost uses what you paid plus any buying costs you enter. Current value uses what the property is worth today to give a yield based on today’s valuation.
Why does the rental yield calculator ask for buying costs separately?
Buying costs can materially change the effective purchase cost base. Including them can reduce the gross and net yield compared with using price alone.
What should I include in “annual costs” on the rental yield calculator page?
Include recurring costs such as insurance, letting agent fees, ground rent, service charges, and typical maintenance. The calculator treats it as a single annual figure.
Is the mortgage payment required for the rental yield calculator?
No. It is optional and is used only to estimate a simple net cashflow. Yield calculations can still be useful without a mortgage payment.
What does gross rental yield measure in this calculator?
Gross yield is annual rent divided by the base value. It does not subtract any costs, so it is a high-level headline figure.
How does net yield differ from gross yield on this page?
Net yield subtracts your annual costs (and the mortgage payment if you include it) before dividing by the base value, so it can better reflect ongoing cost assumptions.
Does this rental yield calculator include income tax or capital gains?
No. It is not a tax model. If you need after-tax profitability, you should speak to a qualified tax adviser and consider your full circumstances.
Why does the calculator warn that voids are not included unless I enter them as costs?
Because voids reduce income rather than increase costs. If you want a rough allowance, you can convert expected voids into an annual cost equivalent and include it.
What is a sensible way to use the rental yield output when comparing two properties?
Use consistent assumptions for rent and costs across both properties and compare gross yield, net yield, and net cashflow together rather than relying on one number.
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