Rental Yield Calculator

Rental yield is the annual rental income expressed as a percentage of the property price. It shows how profitable a buy-to-let investment is.

Divide the annual rent (monthly rent × 12) by the property price and multiply by 100. For example, £1,300 per month × 12 ÷ £260,000 × 100 = 6% gross yield.

The gross one uses only the rent and the price. The net one first subtracts annual costs (tax, maintenance, insurance, void periods), reflecting the real profit.

Indicatively, a gross yield of 5–7% is considered solid in many UK cities. In London and the South East it is often lower (3–5%), with more of the return coming from capital growth.

Income tax on the rental profit (at your marginal rate, e.g. 20% or 40%), letting-agent fees, maintenance and repairs, landlord insurance, any ground rent or service charge, and the months the property sits empty.

No. Rental yield measures only the rental income. The total investment return also includes the appreciation (or depreciation) of the property value over time.

It depends on the rental yield versus alternatives, your need for liquidity and the growth outlook. A good net yield and a rising area favour letting out.

Through a higher rent (refurbishment, furnishing), a lower purchase price (negotiation), reducing costs, and minimising the void periods when the property sits empty.