Rental Yield Calculator
Calculate gross and net rental yield for any investment property — including vacancy, management fees, and running costs.
Property & rent
Annual expenses
Gross yield
4.23%
Before expenses & vacancy
Net yield
2.46%
After all expenses
Annual income & expenses
Estimates only. Does not include interest costs, depreciation, or tax implications. Consult a tax advisor for investment property advice.
How this calculator works
Gross yield is the simplest measure: annual rent divided by purchase price, expressed as a percentage. It ignores all expenses and is useful for quick comparisons between properties.
Net yield is more meaningful for investment decisions. It deducts vacancy loss, property management fees, council rates, insurance, maintenance, and strata levies from your annual rent before dividing by the purchase price. A net yield above 4% is generally considered strong for Australian residential property.
Note that net yield does not include your interest repayments. A property with a 3% net yield and a 6.5% mortgage rate will be negatively geared — meaning you pay more in interest than you receive in rent.
Worked example
$750,000 apartment, $680/week rent, 2 weeks vacancy, 8% management fee
Typical expenses to budget for
- Property management: Typically 7%–10% of rent collected in Australian capital cities, plus letting fees (1–2 weeks rent per tenancy).
- Council rates: Varies significantly by council and property value — budget $1,500–$3,500 per year for most metro properties.
- Strata levies: Applicable to apartments and townhouses. Admin levies cover day-to-day expenses; capital works (sinking fund) levies cover major repairs. Combined can range from $2,000 to $10,000+ per year.
- Maintenance: Budget 0.5%–1% of property value annually for ongoing maintenance. Older buildings typically need more.
- Landlord insurance: Typically $1,500–$2,500 per year. Covers tenant defaults, malicious damage, and loss of rent.
Frequently asked questions
What is a good rental yield in Australia?
A gross yield of 4%–6% is considered reasonable for Australian residential property. Net yields are typically 1%–2% lower after expenses. Regional areas and smaller cities often offer higher yields; Sydney and Melbourne inner-city apartments tend to yield 2%–4% gross due to high property prices relative to rents.
What is negative gearing?
A property is negatively geared when the rental income is less than the holding costs (interest + expenses). The shortfall is a net loss that can be offset against your other income (e.g. salary) for tax purposes at your marginal rate. Many investors accept negative gearing in expectation of capital growth.
Does this calculator include depreciation?
No. Tax depreciation (Division 43 for building structure and Division 40 for plant and equipment) can significantly improve an investor's after-tax cash position, but it varies by property age, type, and tax situation. A quantity surveyor can prepare a depreciation schedule; consult your accountant for advice.
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