Gross rental yield
Annual scheduled rent ÷ property value × 100
A quick comparison that ignores vacancy and expenses.
Rental Yield Calculator: Net Yield, ROI and Cap Rate
Calculate rental income, net yield, cash flow and first-year ROI after vacancy, property tax, operating costs and mortgage payments.
Rental yield, ROI and Cap Rate formulas
The calculator keeps property performance separate from financing, so you can compare markets before deciding how to fund a purchase.
Net rental yield
NOI ÷ total acquisition cost × 100
Total acquisition cost is property value plus purchase and closing costs.
Cap Rate
NOI ÷ property value × 100
A financing-neutral measure of operating performance.
Cash-on-cash return
Cash flow after mortgage ÷ cash invested × 100
Cash invested is your equity contribution plus purchase costs.
First-year ROI
(Cash flow + principal repaid) ÷ cash invested × 100
Includes first-year mortgage principal reduction but not property appreciation.
Worked rental property example
For a property value of 100,000, purchase costs of 5,000, monthly rent of 1,000, 5% vacancy and annual operating expenses of 2,600, assume a 60,000 mortgage at 7% for 20 years.
Gross yield
12%
Net rental yield
8.38%
Cap Rate
8.8%
Cash-on-cash return
7.15%
First-year ROI
10.32%
Use the Load example button to place these assumptions in the calculator. The values are illustrative and are not a city or market average.
How to compare rental returns between cities
Compare the same property type, currency and data period in every city. Start with BestYieldFinder market data, then add local expenses and your financing terms.
Compare markets in BestYieldFinder| Calculator input | City comparison value |
|---|---|
| Property value | Median asking price for the same property type and size. |
| Monthly rent | Median asking rent for the matching property segment and period. |
| Vacancy | A local occupancy assumption supported by comparable properties. |
| Local costs | Property tax, insurance, management, maintenance and owner-paid utilities. |
BestYieldFinder market figures are asking-price benchmarks, not guaranteed transaction prices or achieved rent. Keep all assumptions consistent when comparing cities.