📈 Rental Yield Calculator
Rental Yield = Annual Rent ÷ Property Price × 100
to see your rental yield
Frequently Asked Questions
How do I use the Rental Yield Calculator?
Enter the property's purchase price, the monthly rent you receive (or expect to receive), any annual expenses like maintenance, property tax or insurance, and an estimated vacancy rate if the property may be unoccupied for part of the year. Click "Calculate Yield" to see the gross and net rental yield, annual rental income, and monthly net income.
What is gross rental yield?
Gross rental yield is the annual rent (monthly rent × 12) divided by the property's purchase price, expressed as a percentage. It gives a quick, simple measure of return without accounting for any running costs or vacancies.
What is net rental yield and how is it different?
Net rental yield subtracts annual expenses (maintenance, property tax, insurance, etc.) from the effective annual rent — which itself accounts for any vacancy — before dividing by the property price. It gives a more realistic picture of the actual return on your investment.
What is a good rental yield in India?
Residential rental yields in most Indian cities typically range from 2% to 4%, while commercial properties often yield 6-10%. A yield above 3-4% for residential property is generally considered good, though location, property type and demand vary widely.
How does vacancy rate affect rental yield?
The vacancy rate represents the percentage of the year the property is expected to sit unoccupied with no rental income. This reduces the effective annual rent used in both gross and net yield calculations — for example, a 10% vacancy rate means only 90% of the annual rent is counted.
Does rental yield account for property appreciation?
No. Rental yield measures only the income return from rent relative to the property price — it does not include any capital gains from the property's value increasing over time. Total return on a property investment combines rental yield with capital appreciation.
Should I include the home loan EMI in annual expenses?
No. Rental yield is a measure of return on the property's purchase price, not on the cash you've put in, so loan interest and EMI payments are not included in annual expenses. Only recurring property-related costs — maintenance, property tax, society charges, insurance and repairs — should be entered there.
Does this calculator account for income tax on rental income?
No. The net yield shown is before income tax. Rental income in India is taxed as "Income from House Property" after a standard 30% deduction on the net annual value (and home loan interest deduction, if applicable), so your actual post-tax return will be lower than the net yield calculated here.