Rental Yield & ROI Calculator
Analyze investment property returns with gross yield, net yield, cash-on-cash return, and internal rate of return (IRR) calculations.
Property & Investment Details
Enter purchase details, income, and expenses to calculate ROI metrics.
Annual Operating Expenses
ROI Analysis Results
Gross Rental Yield
0.00%
Annual rent / Purchase price
Net Rental Yield
0.00%
(Rent - Expenses) / Purchase price
Cash-on-Cash Return
0.00%
Annual cash flow / Down payment
Projected IRR
0.00%
Including appreciation and cash flow
Total Cash Flow
$0
Over holding period
Total Equity Gain
$0
From appreciation
How Rental Yield & ROI Calculator Works
Calculate rental yield, net yield, cash-on-cash return, and IRR for investment properties. Free real estate ROI analysis tool.
Core Use Case Scenario
Financial planners and prospective homebuyers compare the 30-year wealth impact of renting versus purchasing, factoring appreciation, investment returns, and transaction costs.
Troubleshooting & Edge-Case Failure Points
- Appreciation is unrealized — compare against realistic returns.
- Include closing costs (~2-5%) and selling commissions (~6%).
- Tax deductibility varies by jurisdiction.
- Moving costs can shift crossover timing by years.
Step-by-Step Instructions
- Set home price, down payment, mortgage rate, and loan term.
- Input property tax, maintenance, HOA, and appreciation.
- Enter monthly rent, rent inflation, and investment return.
- Calculate to see net worth trajectories and crossover year.
Related Web Utilities (Silo Hub)
Informative Guides & Helper Articles
Cash on Cash Return Explained for Real Estate Investors
Learn what cash on cash return is, how to calculate it, and why it is one of the most important metrics for real estate investors using leverage.
Read Article →Gross vs Net Rental Yield: What's the Difference?
Understand the difference between gross and net rental yield. Learn why net rental yield is more important for real estate investment analysis.
Read Article →How to Calculate Rental Yield for Investment Properties
Learn how to calculate rental yield for investment properties. Understand gross yield, net yield, and what makes a good rental yield.
Read Article →Investment Property ROI Analysis: Complete Framework
Conduct a complete investment property ROI analysis using yield, cash-on-cash return, and IRR. Learn the framework professional investors use to evaluate deals.
Read Article →Real Estate IRR Calculation Guide for Investors
Learn how to calculate Internal Rate of Return (IRR) for real estate investments. Understand what makes a good IRR and how to use it to compare properties.
Read Article →How to Use the Rental Yield Calculator
- Enter the purchase price (including closing costs and any immediate repairs — that is your true basis).
- Enter expected monthly rent and the vacancy rate (5–8% is a realistic planning default).
- Add operating expenses: property tax, insurance, maintenance (budget 1% of value/yr), HOA, management if used.
- Read gross yield, net yield, and the 1% rule check — the three numbers investors screen with.
How the Math Works
Net yield = (Annual rent − vacancy − operating costs) ÷ Price
Cap rate = NOI ÷ Price
Worked example: a $250,000 duplex renting for $1,900/month per side? No — take the simpler single unit: $250,000 property, $1,900/month rent. Gross yield = $22,800 ÷ $250,000 = 9.1%. Now reality: 6% vacancy ($1,368), operating costs of $4,100 (tax, insurance, maintenance reserve, management at 8%) leave NOI ≈ $10,930 — a net yield of 4.4%. That gap between the pretty gross number and the honest net number is where bad investments live. The 1% rule (monthly rent ≥ 1% of price = $2,500 here) is a 10-second screen, not a verdict: this property fails it at $1,900, yet may still beat index funds after appreciation in a growing metro.
What Counts as a Good Yield
| Market type | Typical gross yield | Typical net yield |
|---|---|---|
| Midwest cash-flow markets | 8–12% | 4–6% |
| Sun Belt growth metros | 6–9% | 3–5% |
| Coastal appreciation markets | 3–6% | 1–3% |
Net yields above ~6% usually price in risk: weaker tenant demand, aging stock, or shrinking populations. Yield and appreciation trade off — choose which you are buying for. Cap-rate context: Freddie Mac multifamily surveys track market rates.
Rental Yield FAQ
What is the 1% rule in real estate?
Monthly rent should be at least 1% of the purchase price for a quick pass/fail screen. It is a starting filter, not an investment thesis — always verify with net yield including vacancy, taxes, and maintenance.
What is a good rental yield?
Gross 6-10% depending on market type; net 3-6%. Midwest markets print higher yields with slower appreciation; coastal markets print 1-3% net yields betting on appreciation.
Does the calculator include mortgage payments?
No — yield and cap rate are unleveraged metrics by design (they measure the asset). For after-financing cash flow, use our rental cash flow calculator alongside this one.
What expenses do landlords forget?
Vacancy (5-8%), maintenance reserve (1% of value per year), capital expenses (roof, HVAC every 10-15 years), leasing fees, and management — DIY management is a job you are doing for ~8-10% of rent.