Rental Yield Calculator
Gross and net rental yield on an investment property.
Property & Rent
Gross and net yield update as you type.
Gross yield
4.80%
Net yield
2.95%
$600 a week on a $650,000 property. Net yield on total cost incl. purchase costs: 2.82%.
Where the rent goes each year
| Vacancy (2 weeks) | $1,200 |
| Property management fee | $2,100 |
| Council rates | $2,200 |
| Strata / body corporate | $3,000 |
| Landlord insurance | $1,500 |
| Repairs & maintenance | $1,200 |
| Water rates | $800 |
| Costs as % of rent collected | 36.00% |
Cash flow with your loanNegatively geared
Pre-tax, interest-only. Cash invested (price + purchase costs − loan): $160,000.
To reach a 5.00% gross yield
If the rent changes
| Weekly rent | Gross yield | Net yield |
|---|---|---|
| $550(−$50) | 4.40% | 2.60% |
| $575(−$25) | 4.60% | 2.77% |
| $600 | 4.80% | 2.95% |
| $625(+$25) | 5.00% | 3.13% |
| $650(+$50) | 5.20% | 3.31% |
How to Use the Rental Yield Calculator
Enter the property price and the rent (weekly, monthly or yearly), then add expected vacancy, the property manager's fee and your yearly running costs. The rental yield calculator shows gross and net yield, where the rent goes, and — if you add a loan — your weekly cash flow and whether the property would be positively or negatively geared.
The Rental Yield Formulas
Rent collected = annual rent minus the weeks the property is vacant. Loan interest is not included.
Worked Example
A unit bought for $650,000 rents for $600 a week, or $31,200 a year — a gross yield of 4.80%. Allow 2 weeks of vacancy ($1,200), so $30,000 of rent is collected. A 7% management fee on that is $2,100, and running costs (council rates $2,200, strata $3,000, insurance $1,500, maintenance $1,200 and water $800) add up to $8,700. That leaves $19,200 of net income a year, a net yield of 2.95% on the price, or 2.82% once $30,000 of purchase costs is included.
With a $520,000 interest-only loan at 6.2%, interest is $32,240 a year, so the property is negatively geared by $13,040 a year (about $250.77 a week) before tax. To reach a 5% gross yield at this price, the rent would need to be $625 a week — or the price no more than $624,000 at today's rent.
Yield vs Capital Growth
Rental yield and capital growth often pull in opposite directions. Properties with strong expected growth tend to cost more relative to the rent they earn, so their yields are lower, while higher-yielding properties can grow in value more slowly. Neither is better on its own — what matters is whether the combination fits your cash flow, borrowing capacity and plans for the property.
Frequently Asked Questions
- How do you calculate rental yield in Australia?
- Gross rental yield is the annual rent divided by the property price, times 100. Because Australian rents are quoted per week, multiply the weekly rent by 52 first: a property renting for $600 a week ($31,200 a year) and bought for $650,000 has a gross yield of 4.80%.
- What's the difference between gross and net rental yield?
- Gross yield uses the full year's rent with no costs taken off. Net yield subtracts the rent lost to vacancy and your running costs — property management fees, council and water rates, strata, landlord insurance, maintenance and land tax — so it shows what the property actually earns. Net yield is always lower, and it's the better number for comparing properties.
- What is a good rental yield in Australia?
- There's no single right number. Many investors use a gross yield of around 5% as a rough benchmark, but yields vary a lot by location and property type — units and regional properties often yield more than capital-city houses, which investors usually buy for expected capital growth instead. Compare net yields on properties you're actually considering rather than relying on a rule of thumb.
- Which costs should I include in a net rental yield calculation?
- Include the costs you pay as a landlord every year: the property manager's fee (often a percentage of rent collected), council rates, water rates (where the tenant doesn't pay usage), strata or body corporate levies, landlord insurance, repairs and maintenance, land tax if it applies, and an allowance for weeks the property sits empty. Leave out loan interest — that's a financing cost, which this calculator shows separately as cash flow.
- Does rental yield include my mortgage repayments?
- No. Rental yield measures the property's income against its price, regardless of how it's financed. To see what happens once your loan is included, enter a loan amount and interest rate: the calculator then shows your pre-tax cash flow after interest and whether the property would be positively or negatively geared.
- What does positively or negatively geared mean?
- A property is positively geared when the rent covers all its costs including loan interest, leaving a surplus. It's negatively geared when costs and interest exceed the rent, creating a loss that can generally be deducted against your other taxable income. A loss is still a loss — investors who negatively gear are usually relying on capital growth to come out ahead.
- How much rent do I need to get a 5% (or any) rental yield?
- Multiply the property price by the target yield and divide by 52 for a weekly figure. For a $650,000 property, a 5% gross yield needs $625 a week. Enter your own target yield and the calculator shows the weekly rent needed, plus the highest price you could pay for the current rent to hit that yield.
- Should I calculate yield on the purchase price or the total cost?
- Both are useful. Yield on the purchase price is the convention used in listings and reports, so it's best for comparing properties. Yield on total cost — price plus stamp duty, legal fees and inspections — shows the return on everything you actually spent, so it's always a little lower. This calculator shows both when you enter purchase costs.
- Is rental yield the same as return on investment?
- No. Rental yield only counts rental income. Your total return also depends on capital growth (or loss), tax effects, and how much of your own money is in the deal. The cash-on-cash return shown here compares your yearly cash flow with the cash you put in, which is closer to a return on investment for a leveraged purchase, but it still excludes capital growth and tax.