What Is My Rental Yield?
You can work out your rental yield with our rental yield calculator. Enter your monthly rental income and the price you paid for the rental property, then and simply click “Calculate”’.
This is a rental yield calculator and not a quotation under the Consumer Credit Act. All results are based on the figures input.
This calculator does not take into account any ongoing maintenance costs of the property. Mortgage approvals are also subject to validation of income, credit checks and a property valuation.
What is Rental Yield?
The definition of rental yield or property yield is the return you make – or expect to make – on a property you either own or are thinking about purchasing. Property investors and landlords use rental yield to measure the value of their investments as they want to know the return on their capital outlay.
How to Calculate Rental Yield for UK Properties
To work out rental yield you apply this simple rental yield formula:
Rental yield = (Monthly rental income x 12) ÷ Property value
We’ve broken down how you use this formula to calculate rental yield below:
- Take the monthly rental income amount or expected rental income and multiply it by 12
- Divide it by the property’s purchase price or current market value
- Multiply this figure by 100 to get the percentage
Example:
- Your monthly rental income is: £1,300
- Your annual rental income is: £1,300 x 12 = £15,600
- You purchased the property for: £250,000
- Your rental yield is: (£15,600 ÷ £250,000) x 100 = 6.24%