Rental yield calculator
Rental yield calculator
Gross yield is the yearly rent divided by the price. Net yield takes off the running costs first: letting fees, insurance, repairs, service charge, ground rent and empty months. Enter your figures to see both, then open the buy-to-let calculator to add the mortgage, stamp duty and tax.
Work out your own figures
Enter the price and the monthly rent, then the running costs you know. A blank box counts as nothing. It is free, needs no sign-up, and the answer comes from the same engine as the full calculator.
Gross and net rental yield
Gross yield uses only the rent and the price: multiply the monthly rent by twelve, divide by the price and multiply by a hundred. It is quick and good for a first sort through listings, but it ignores every cost.
Net yield starts from the rent left after the running costs: the letting or management fee, a maintenance reserve, a void allowance for empty weeks, landlord insurance, and ground rent and service charge on a flat. It is the better figure for comparing two properties, because a flat with a large service charge can show a fine gross yield and a poor net one.
Neither yield includes the mortgage, stamp duty or tax. They measure the property, not your return on cash. For that, use the buy-to-let calculator, which adds the mortgage and shows the cash-on-cash return.
What each box means
- Purchase price
- What you expect to pay. Use the price you would offer after checking sold prices, not the asking price.
- Monthly rent
- The rent a tenant would pay each month, from current listings and letting agents.
- Letting or management fee, maintenance reserve, void allowance
- Each as a share of the rent, because each rises and falls with it.
- Insurance, ground rent and service charge
- Fixed amounts each month. Divide a yearly bill by twelve.
What is a good rental yield?
There is no single figure that is good everywhere. Yields are higher where prices are lower, so a cheaper home often shows a better yield with more risk of empty months and repairs. Compare net yields, like with like, and look at what is left after the mortgage.
The lender's test sets one useful floor. At the calculator's standard stress rate of 5.5%, a £200,000 buy-to-let with a 25% deposit needs rent of about £997 a month to pass at the 145% pass mark for a higher-rate borrower, a gross yield of 6.0%. At the 125% pass mark for basic-rate and company borrowers it is about £860 a month, 5.2%. A lower yield means a smaller loan or a bigger deposit.
To see what homes actually sell for in a town or postcode, use the house prices pages, built from HM Land Registry data.
How much could the rent borrow?
The calculator also shows the largest loan the rent supports at the lender's standard test: the year's rent divided by the stress rate and the pass mark. With no tax band chosen it uses the 145% pass mark. Lenders vary, so treat it as a guide and ask yours.
A worked example
A property costs £200,000 and lets for £1,100 a month. The landlord allows 12% of the rent for letting and management, 8% for repairs and 4% for empty weeks, and pays £30 a month for insurance.
| Purchase price | £200,000 |
|---|---|
| Monthly rent | £1,100 |
| Letting or management fee, share of rent | 12% |
| Maintenance reserve, share of rent | 8% |
| Void allowance, share of rent | 4% |
| Landlord insurance per month | £30 |
| Annual rent | £13,200 |
|---|---|
| Gross yield | 6.6% |
| Running costs per month | £294 |
| Net yield | 4.8% |
| Largest loan the rent supports | £165,517 |
The running costs of £294 a month take the yield from 6.6% gross to 4.8% net. The same property, with a mortgage added, is the worked example on the buy-to-let calculator.
Questions and answers
What is the difference between gross and net rental yield?
Gross yield is the annual rent divided by the purchase price. Net yield takes the running costs off the rent first, then divides by the price. Neither includes the mortgage or tax.
How do I calculate gross rental yield on a buy-to-let?
Multiply the monthly rent by 12, divide by the purchase price and multiply by 100. For £1,100 a month on £200,000, that gives 6.6%.
Does rental yield include the mortgage?
No. Both gross and net yield are measured against the purchase price and ignore the cost of borrowing and tax. The mortgage appears in the cash flow and in the cash-on-cash return, which measures the annual cash flow against the cash you actually paid in.
Is stamp duty part of rental yield?
No. Stamp duty is part of the cash you need up front, so it lowers the cash-on-cash return, but it does not change the yield. In the example it is £11,500 of the £64,500 needed.
What is a good rental yield in the UK?
There is no single good figure: it depends on the area, the type of property, the running costs and the mortgage. Compare net yields, and check that the rent passes the lender's test. At the calculator's standard figures, a buy-to-let with a 25% deposit needs a gross yield of about 6.0% to pass at the 145% pass mark, or 5.2% at 125%.
Should I use the asking price or the price I pay?
The price you expect to pay. The asking price is the seller's hope, and a lower price raises the yield. Check what similar homes sold for before you work out the yield.
Read the guides
Other calculators
These figures are estimates from the Deal Analyser calculator, using the UK rules as checked on 10 October 2026. They are not financial, tax or legal advice. Check them for your own deal, and take advice from a regulated adviser, accountant or solicitor before you commit.
Take the yield further
The buy-to-let calculator adds the mortgage, stamp duty, the lender's test and Section 24 tax. It is free to use, and your results show straight away without an account. Sign in when you want to save them.
Open the full calculator