Why use this calculator
Rental yield is the key metric for property investors — but gross yield alone is misleading. This calculator shows your real net yield and annual cash flow after expenses, so you can compare properties and assess whether a purchase makes financial sense.
How to use it
Enter the purchase price, weekly rent, expected vacancy, and your key expenses: council rates, landlord insurance, property management fee (typically 7-10%), maintenance, and loan interest. The result shows gross yield, net yield, and whether the property is positively or negatively geared.
The formula
Gross Yield = (Weekly Rent × 52) ÷ Property Price × 100. Net Yield = (Annual Rent − All Expenses) ÷ Property Price × 100. Cash Flow = Annual Rent − All Expenses.
Worked examples
$600k property, $550/wk rent, standard expenses, $28k interest
4.77% gross yield, ~1.2% net yield, negatively geared
$400k property, $450/wk rent, minimal expenses, no mortgage
5.85% gross yield, 4.1% net yield, positively geared
When people use it
- Comparing investment properties
- Assessing negative gearing impact
- Setting rent for break-even
- Evaluating refinancing options
Tips
- A gross yield of 4-5%+ is generally considered acceptable in Australian capital cities
- Negative gearing means the property costs more than it earns — losses are tax-deductible
- Property management fees typically run 7-10% of rent plus GST
- Budget 1% of property value per year for maintenance as a rule of thumb
- Land tax may apply if your investment portfolio exceeds your state's threshold
Questions people ask
- What is a good rental yield in Australia?
- Gross yields vary by location. Regional areas often yield 5-7%+, while Sydney and Melbourne inner suburbs typically yield 2.5-4%. Net yield (after expenses) is a more meaningful comparison.
- What does negatively geared mean?
- A negatively geared property costs more to hold than it earns in rent. The shortfall is tax-deductible at your marginal rate, and investors rely on capital growth to generate long-term profit.
- Is rental yield calculated on purchase price or market value?
- Conventionally, yield is calculated on purchase price when buying. If you already own and want to know your current return, use current market value instead.