What is a good rental yield in 2026?

A good gross rental yield in 2026 is 5-8% for residential property. Net yield (after expenses) of 4-6% is considered strong. In UK and US markets, yields above 7% gross are excellent. Coastal and expensive cities typically yield 2-4% gross, while Midwest and Northern England offer 6-9%.

What is the difference between gross and net rental yield?

Gross rental yield = (annual rent / property value) × 100. Net rental yield = ((annual rent – all expenses) / property value) × 100. Expenses include property management (8-12%), maintenance (1-2% of value), insurance, property tax, and vacancy. Net yield is typically 1.5-3% lower than gross.

How do I calculate cash-on-cash return for a rental property?

Cash-on-cash return = (annual pre-tax cash flow / total cash invested) × 100. If you invest $80,000 down payment on a property and receive $6,000 net cash flow per year, your cash-on-cash return is 7.5%. This measures the return on your actual cash invested, not the total property value.

What is the 1% rule in real estate investing?

The 1% rule states that a rental property's monthly rent should equal at least 1% of its purchase price to generate positive cash flow. A $200,000 property should rent for at least $2,000/month. In expensive markets, finding 1% properties is nearly impossible — most investors use it as a quick screening filter.

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Home › Rental Yield Calculator

Rental Yield Calculator

Q: What is the difference between gross and net yield?

Gross yield is annual rent divided by property value before expenses. Net yield subtracts all costs including management, insurance, maintenance and taxes.

Q: What is cash-on-cash return?

Cash-on-cash return measures annual net income divided by actual cash invested (down payment + purchase costs). It accounts for leverage.

Calculate gross yield, net yield, cash flow, ROI, and payback period for any investment property instantly.

🏠 Property Details

Purchase

Property Value

Down Payment

Purchase Costs (legal, stamp duty…)

Income

Monthly Rental Income

Annual Vacancy (weeks)

wks

Annual Expenses

Management Fee (% of rent)

Insurance / Year

Maintenance / Year

Property Tax / Year

Mortgage Payment / Month

📊 Investment Analysis

Net Rental Yield

4.8%

✅ Good yield

0%3% Fair5% Good8%+

📈 Gross Yield7.2%

📉 Net Yield4.8%

💵 Annual Gross Income$21,600

💸 Annual Expenses$7,200

✅ Annual Net Income$14,400

📅 Monthly Cash Flow$1,200

💰 Cash-on-Cash Return21.8%

⏱️ Payback Period4.6 yrs

Total Invested

$65,000

Annual ROI

21.8%

Gross/mo

$1,800

Net/mo

$1,200

Frequently Asked Questions

What is a good rental yield?▾

A gross yield of 5–8% is generally considered good. Net yield of 3–5% is typical for stable urban markets. Above 8% net yield is excellent but may signal higher risk or a lower-demand area.

What is the difference between gross and net yield?▾

Gross yield is annual rent divided by property value, before expenses. Net yield subtracts all costs (management, insurance, maintenance, vacancy, taxes) first. Net yield is the more realistic metric for investors.

What is cash-on-cash return?▾

Cash-on-cash return is annual net income divided by your actual cash invested (down payment + purchase costs). It measures real return on the money you put in, accounting for leverage. Often more useful than yield for mortgage investors.

Should I include mortgage in expenses?▾

Yes — add your full monthly mortgage payment to see true cash flow. Note that only the interest portion is a real cost; principal repayments build equity. For yield calculation, only the interest matters, but for cash flow, use the full payment.