Returns, before the loan
Rental yield calculator.
Gross yield is the quick comparison; net yield, after vacancy and the costs of holding, is closer to what the property earns. The tool opens on an editable example, so replace each figure with the property's own.
Net yield
3.82%
Rent collected less yearly costs, as a share of the purchase price.
Gross yield
5.20%
A full year's rent, every week let, as a share of the purchase price.
Net income
$22,900
What is left from the rent each year, before loan costs and tax.
Rent for a full year
$31,200
The weekly rent across every week of the year.
Costs and vacancy
$8,300
Your yearly costs plus the rent lost to vacancy.
Calculated on the purchase price, the gross yield is 5.20% and the net yield is 3.82%, leaving about $22,900 a year before loan costs and tax.
Where the rent goes
| Vacancy | $1,200 |
|---|---|
| Council and water rates | $2,000 |
| Landlord insurance | $1,500 |
| Property management | $2,100 |
| Maintenance | $1,500 |
| Costs and vacancy | $8,300 |
How it is worked out
- Rent for a full year is the weekly rent across every week of the year.
- Gross yield is that rent as a share of the purchase price.
- Vacancy is the weekly rent for each week you expect the property to sit empty. It comes off the full year to give the rent collected.
- Property management is your percentage of the rent collected, not of the full year's rent.
- Yearly costs are rates, insurance, management, maintenance, strata and land tax, added together.
- Net income is the rent collected less yearly costs.
- Net yield is net income as a share of the purchase price.
What this tool leaves out
- The loan. Interest and repayments are not counted, so net yield describes the property, not your finance. The cash flow calculator adds them.
- Tax and depreciation. Nothing here estimates what the property may do to your tax.
- Buying costs. Stamp duty and fees are not added to the price, so both yields sit on the price alone.
- Change over time. Rent, costs and the property's value are held where you set them.
- Costs you do not enter, such as letting fees or replacing an appliance. Add them to maintenance if you expect them.
- Today's value. If the property has grown since you bought it, a yield on today's value would be lower than the figure here.
Questions investors ask
Why is yield calculated on the purchase price?
Because that is what you pay, and it is how yield is quoted across this site. A yield on today's value would usually be lower once a property has grown. When someone quotes you a yield, ask which basis they used, because comparing one basis with another can make a property look better than it is.
Gross or net: which should I look at?
Gross yield is useful for a quick comparison between listings, because it needs only the price and the rent. Net yield counts vacancy and the costs of holding, so it is closer to what the property actually earns. Two properties with the same gross yield can sit far apart on net once strata, insurance and maintenance are counted.
Does net yield include the loan or tax?
No. Net yield is before interest, loan repayments, depreciation and tax, so it describes the property, not your finance or your tax position. The cash flow calculator adds the loan and an estimate of the tax effect.
Why is the management fee worked out after vacancy?
Property managers usually charge a share of the rent they collect, so weeks without a tenant attract no fee. The tool takes vacancy off first, then applies your management percentage to what is left.
What should I enter for maintenance and vacancy?
There is no single right figure. An older home, a pool or a large garden usually costs more to keep, and vacancy depends on the area and the property. A building and pest report and a local property manager are the best sources for the property in front of you.
Is a higher yield always better?
Not on its own. Yield describes income against price, not the quality of the asset, and a high yield can be the market pricing in a risk, such as thin rental demand or a property that needs work. It is one number to weigh alongside the condition of the property and the strength of its rental market.
Where do the starting figures come from?
The tool opens on an editable example so you can see how it works. The figures are not a claim about any market or property, so replace each one with the numbers for the property you are looking at.
Where to next
If you are weighing up a property, we can test its rent and costs against the evidence with you.
This calculator gives general information only. The figures are estimates built from the inputs you enter, with yield calculated on the purchase price, and they are not a valuation or a rental appraisal. It is not financial or tax advice, and apart from the figures you enter, it does not take into account your objectives, financial situation or needs. CHAD Property coordinates with brokers, accountants and planners and does not give tax, credit or financial advice, so check each cost with the selling agent, a property manager and the relevant notices before you act.
The tools on this page give general information only. Each result is an estimate, worked out from the figures you enter and the assumptions shown, using rates and rules as at the date shown. It is not a quote, and it is not intended to be relied on to make a decision about a financial product, a loan or your tax. It is not personal financial, tax, credit or legal advice, and apart from the figures you enter, it does not take into account your objectives, financial situation or needs. Rates, thresholds and laws change, and some details of recent changes are not yet final. CHAD Property is a buyer's agency. It does not hold an Australian financial services licence or an Australian credit licence, and it is not a registered tax agent. We do not advise on tax, lending, financial products or how to structure ownership, including through a self-managed super fund, a company or a trust; we work alongside the brokers, accountants and financial planners who do. Before you make a financial decision, consider getting advice from a licensed financial adviser, and check any figure here with a licensed or registered professional who knows your situation.