1. What is Rental Yield?

Rental yield is a measure of the return on investment for a rental property, expressed as a percentage of the property's value. It helps investors compare the profitability of different rental properties.

2. How Does the Calculator Work?

The calculator uses the rental yield formula:

Where:

• Rental Income — Annual rental income in dollars
• Property Price — Total purchase price of the property in dollars

Explanation: The formula calculates what percentage of the property's value you earn back each year through rental income.

3. Importance of Rental Yield Calculation

Details: Rental yield helps investors assess the potential return on investment, compare different properties, and make informed buying decisions.

4. Using the Calculator

Tips: Enter the annual rental income and property purchase price in dollars. Both values must be greater than zero.

5. Frequently Asked Questions (FAQ)

Q1: What is a good rental yield?
A: Generally, 5-8% is considered good, but this varies by location and property type.

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

Q3: How does yield compare to ROI?
A: Yield shows annual return based on property value, while ROI considers total investment including financing costs.

Q4: Does yield account for property appreciation?
A: No, yield only considers rental income. Total return would include both yield and appreciation.

Q5: How often should I calculate yield?
A: Recalculate whenever rental income changes or when considering property improvements.