Finance & Investment · Real Estate
Rental Yield Calculator
Work out a rental property's gross yield, its net yield after maintenance, taxes and empty months, the monthly cash it really earns and its price-to-rent ratio — so you can compare it with a fixed deposit or other investments.
Your inputs
Quick start — try a typical case
₹ 80 lakh
₹ 25 thousand
₹ 30 thousand
Maintenance/society charges, property tax, insurance, repairs, letting fees.
Your result Live
Net Rental Yield
3.06%
Gross yield 3.75% before costs and empty months
- Gross Rental Yield
- 3.75%
- Net Income per Year
- ₹2,45,000
- Net Income per Month (average)
- ₹20,417
- Price-to-Rent Ratio
- 26.7 years of rent
- Years to Recover Cost from Net Rent
- 32.7 years
- Net income · 82%₹2,45,000
- Running costs · 10%₹30,000
- Lost to empty months · 8%₹25,000
How this is calculated
Gross yield = 12 × Rent ÷ Value · Net yield = (Rent × (12 − empty months) − Costs) ÷ (Value + Purchase costs)
- Rent
- Monthly rent
- Value
- Property value (or price paid)
- Costs
- Yearly running costs
Gross yield is the headline number property listings quote. Net yield is what you actually earn on the money tied up after the property sits empty for a while and the bills are paid — usually a percentage point or two lower. Residential rental yields in large Indian cities are often only 2–4 % gross, which is why buyers also count on the property's value rising.
Assumptions & sources
- Rental income only: any rise or fall in the property's price is not included (that is capital growth).
- Income tax on rent, loan interest and depreciation are not deducted.
- Costs and rent are steady through the year.
- 1Real Estate Finance and Investments (Brueggeman & Fisher) — income property analysis — McGraw-Hill
- 2Investments (Bodie, Kane & Marcus), chapters on returns, compounding and the time value of money — McGraw-Hill
Calculator ID FIN-RE-RENTYIELD-001 · version 1.0.0
Common questions
What is a good rental yield?
It depends on the city and property type. Compare the net yield with what the same money would earn risk-free (for example a fixed deposit, after tax): a lower rental yield only makes sense if you expect the property's value to grow.
Should I use the price I paid or today's value?
Use today's value to judge whether keeping the property is worthwhile now (the money could be invested elsewhere). Use the price you paid plus purchase costs to see the return on your original outlay.
Why are purchase costs added to the value?
Stamp duty, registration and brokerage are part of what it cost you to own the property, so the net yield measures income against the full amount tied up.