Rental yield calculator guide
This calculator separates headline rental yield from the numbers that matter more in practice: vacancy, expenses, mortgage payments, and cash-on-cash return.
How to use it
- Enter the property price and the amount of cash invested.
- Add monthly rent and a realistic vacancy assumption.
- Include annual non-mortgage expenses such as repairs, insurance, HOA fees, and management.
- Add the monthly mortgage payment if the property is financed.
Calculation method
Cash-on-cash return compares annual cash flow against the cash invested, which is often more useful when leverage is involved.
Example scenario
A $300,000 property renting for $2,200 per month may look strong on gross yield, but vacancy, repairs, and mortgage payments can reduce or eliminate cash flow.
How to use this calculator
- Enter realistic values that match your current situation.
- Press Calculate to refresh the estimate.
- Compare the main result with the supporting details in the result panel.
- Change one input at a time to see which variable affects the result most.
FAQ
What is a good rental yield?
It depends on the market, financing, risk, and appreciation expectations. Compare similar properties rather than using one universal target.
Why include vacancy?
Vacancy prevents the calculator from assuming the unit is rented every day of the year.
Is cash-on-cash return better than net yield?
For financed properties, cash-on-cash return can show the return on actual cash invested more clearly.