Rental Yield Calculator
Calculate gross and net rental yield on your investment property. Factor in all costs including stamp duty, maintenance, and void periods to see your true return on investment.
Property Details
Annual Expenses
Time between tenants (typically 2-4 weeks)
Mortgage Details (Optional)
Yield Results
Enter Property Details
Input purchase price and monthly rent to calculate yield
Understanding Gross vs Net Yield
Gross vs Net Yield
Gross yield is annual rent ÷ property price. Net yield deducts all costs including maintenance, insurance, void periods, and management fees for a true picture.
What's a Good Yield?
Most buy-to-let investors target 5-8% gross yield. Net yields are typically 2-4% lower. Higher yields often come with higher risk or maintenance requirements.
Impact of Stamp Duty
Stamp duty significantly impacts your total investment cost and therefore your yield calculation. Buy-to-let properties pay an additional 3% surcharge on all bands.
Example Rental Yields
| Property Value | Monthly Rent | Annual Rent | Gross Yield | Est. Net Yield |
|---|---|---|---|---|
| £150,000 | £800 | £9,600 | 6.40% | 4.00% |
| £200,000 | £1,200 | £14,400 | 7.20% | 4.70% |
| £250,000 | £1,200 | £14,400 | 5.76% | 3.26% |
| £300,000 | £1,500 | £18,000 | 6.00% | 3.50% |
| £400,000 | £1,500 | £18,000 | 4.50% | 2.00% |
* Net yield estimates assume 25% cost deduction for maintenance, voids, insurance, and management fees.
Special Considerations
Void Periods
Most landlords experience 2-4 weeks of void periods per year between tenancies. This directly reduces your net yield and should be factored into calculations.
Maintenance Reserves
Budget 10-15% of annual rent for repairs and maintenance. Boilers, appliances, and general wear will need replacement over time, impacting your net returns.
Insurance Costs
Landlord insurance typically costs £200-500 annually and is essential. Contents insurance for furnished lets and rent guarantee insurance add to costs.
Mortgage Interest Impact
Section 24 restricts mortgage interest relief to 20% tax credit. Higher-rate taxpayers should factor this into yield calculations and consider limited company structures.
Important: Gross Yield Isn't Your Real Return
Gross yield doesn't reflect your actual return on investment. Always calculate net yield by deducting all costs including maintenance, insurance, void periods, management fees, and the impact of Section 24 mortgage interest restrictions. Your net yield is typically 2-4% lower than gross yield.
Emma Richardson, MRICS
Chartered Surveyor & Property Tax Specialist
Emma Richardson is a RICS-qualified Chartered Surveyor with over 12 years of experience in UK property taxation. She founded Stamp Duty Calculator to help buyers understand the complex world of property transaction taxes.