Rental yield calculator.

Gross yield is the simplest measure: annual rent divided by the purchase price. It's handy for quick comparisons but ignores what the property costs to run. Net yield subtracts the running costs of holding the property, management fees, council rates, strata, water, insurance and maintenance, before dividing by the price, so it's a truer measure of the return the property itself generates. The gap between the two can be substantial, particularly for strata properties with high levies, so a strong gross yield can mask a mediocre net one.

Net yield is a property-return metric, so it deliberately excludes financing: it measures what the asset earns regardless of how it is funded. The cash-flow result separately subtracts the full principal-and-interest repayment. The taxable rental result deducts only the interest component because repaid principal is not a rental deduction.

Tax gearing follows the taxable rental result: rent less deductible interest, deductible running costs and eligible depreciation. Cash flow follows the money moving through the property and therefore also subtracts principal repayments. A property can be cash-flow negative but tax-positive, so this calculator labels the two results separately. Your accountant should confirm which costs are deductible.

There's no single benchmark, it varies by market and property type. Units and regional properties often yield more than houses in metro areas, where total returns lean on capital growth instead of rent. Many investors treat roughly 4–5% gross as solid in capital cities, and expect more in regional markets. The number that actually matters is net yield in the context of your strategy, weigh it against growth prospects, vacancy risk and running costs rather than chasing the highest headline figure.

The gross rental yield formula is annual rent divided by property value, multiplied by 100. A property renting at $550 per week earns $28,600 a year; against a $650,000 value that's a 4.4% gross yield. Net rental yield uses the same formula but subtracts annual running costs, management fees, council rates, strata levies, insurance and maintenance, from the rent first. This rental yield calculator does both live as you type, and shows exactly where each dollar of rent goes, so you can see what's driving the result.

Count every recurring cost of holding the property: property management fees (commonly 5–9% of rent plus letting fees), council rates, water charges, strata or body-corporate levies, landlord and building insurance, repairs and maintenance, and land tax where it applies. An allowance for vacancy is wise too, even a well-let property sits empty between tenants. The costs people most often forget are strata levies on units and periodic big-ticket maintenance, both of which can turn an attractive gross yield into a thin net one.

Directly and disproportionately. Yield calculations assume 52 rented weeks, but every vacant week removes roughly 2% of your annual rental income while the mortgage, rates and levies keep running. Two weeks of vacancy turns a 5.0% gross yield into about 4.8%, and a month between tenants costs more than most annual insurance premiums. When comparing suburbs, look at the local vacancy rate alongside the advertised yields: a slightly lower yield in a tight rental market often out-earns a higher one where properties sit empty.

Both are legitimate, they just answer different questions. Yield on your historical purchase price tells you how the original investment is performing. Yield on current market value tells you what the capital is earning today, which is the number that matters when deciding whether to hold, refinance or sell, if the value has doubled and the rent hasn't, your real yield has halved, whatever you paid. For the hold-or-sell decision, use an evidenced current value rather than a guess, that's the denominator doing all the work.

Rental yield measures income only, the rent the property generates against its value. Total return adds capital growth, the change in the property's value over time, and for many Australian properties growth contributes more than rent over a full cycle. That's why low-yield houses in high-growth suburbs can outperform high-yield regional properties, and vice versa when growth stalls. A rental yield calculator tells you whether the property pays its way while you hold it; the growth side is a judgement about the market you're buying into.

Not necessarily. An unusually high yield is often the market pricing in risk: limited tenant demand, a single-industry town, high strata levies, or a property type lenders are wary of, and weak capital growth prospects frequently sit behind headline yields that look too good. A modest yield on a property with strong land value and consistent tenant demand can build far more wealth over a decade. Treat yield as one input alongside vacancy risk, growth prospects and your own cash-flow needs, not as a scoreboard.