1. What is Rental Yield Calculator?

The Rental Yield Calculator estimates the return on investment for a rental property as a percentage of the property value. It helps investors compare the profitability of different properties.

2. How Does the Calculator Work?

The calculator uses the rental yield formula:

Where:

• Annual Rent — Total yearly rental income ($)
• Property Value — Current market value of the property ($)

Explanation: The formula calculates what percentage of the property's value is earned back each year through rent.

3. Importance of Rental Yield Calculation

Details: Rental yield is a key metric for real estate investors to assess property performance, compare investments, and make informed purchasing decisions.

4. Using the Calculator

Tips: Enter the total annual rent in dollars and the current property value in dollars. Both values must be positive numbers.

5. Frequently Asked Questions (FAQ)

Q1: What is a good rental yield?
A: Generally, 5-8% is considered good, but this varies by market. Higher yields often come with higher risk.

Q2: Should I use gross or net rental yield?
A: This calculator shows gross yield. For net yield, subtract expenses from annual rent before calculating.

Q3: How does rental yield differ from ROI?
A: Yield shows annual return based on current value, while ROI considers total profit over the investment period.

Q4: Does this account for property appreciation?
A: No, this is purely a measure of rental income return. Total return would include appreciation.

Q5: How often should I recalculate rental yield?
A: Recalculate when rents change significantly or when getting new property valuations.