Rental yield calculator
Gross rental yield is annual rent divided by property value; net yield subtracts running costs first. On this calculator's £220,000 example, renting at £1,100 a month gives an estimated gross yield of 6.0% and a net yield of 4.8%, estimated for 2026/27.
How are gross and net yield calculated?
Gross yield takes a full year of rent and divides it by the property value, before any costs. It is the headline number in listings and quick to compare across areas. Net yield takes the same rent but subtracts the running costs of being a landlord, so it reflects what the property actually generates before finance and tax.
Neither figure includes the mortgage or your tax bill, which is deliberate: yield measures the property, not your personal position. A mortgaged higher-rate landlord will keep far less than the net yield suggests once interest and Section 24 tax are counted, so treat yield as a first screen, not the final return.
What would the yield be in a worked example?
Rent of £1,100 a month is £13,200 a year. On a £220,000 property that is a gross yield of 6.0%. Take off £2,600 of running costs and the net income is £10,600, a net yield of 4.8%. A cheaper property at the same rent would show a higher yield, which is why yields tend to be stronger in lower-priced regions.
Common questions
What is a good rental yield?
As a rough guide, a gross yield of around 5% to 8% is often seen as reasonable for a UK buy-to-let, though it varies by region and property type. The £220,000 example here gives a gross yield of 6.0% and a net yield of 4.8% after running costs.
What is the difference between gross and net yield?
Gross yield is annual rent divided by the property value, before any costs. Net yield deducts running costs such as letting fees, insurance, maintenance and an allowance for empty periods. Net yield is the more honest figure, though it still excludes mortgage interest and tax.
Does yield include the mortgage or tax?
No. This is a property-level yield, so it leaves out mortgage interest and income tax. Since the Section 24 changes, higher-rate landlords cannot fully deduct mortgage interest, which can turn a healthy-looking yield into a thin real return. Check the buy-to-let and Section 24 tool for that.
Which costs should I include?
Typical running costs are letting agent fees, landlord insurance, repairs and maintenance, service charges or ground rent on a leasehold, and a void allowance for months with no tenant. Leave out the mortgage and tax here, since yield measures the property itself.
Should I use the purchase price or current value?
For a yield on what you paid, use the purchase price. To judge the return on money you could release by selling, use the current market value. The two differ once prices move, so pick the one that matches the question you are asking.
How are gross and net yield calculated?
Gross yield divides a year of rent by the property value, before any costs. Net yield takes the same annual rent and subtracts running costs such as letting fees, insurance, repairs and void periods. On the £220,000 example the estimated gross yield is 6.0% and the net yield is 4.8%, once £2,600 of costs are removed.
What would the yield be in a worked example?
Rent of £1,100 a month is £13,200 a year, an estimated gross yield of 6.0% on a £220,000 property. Taking off £2,600 of running costs leaves a net income of £10,600, an estimated net yield of 4.8%. A cheaper property at the same rent would show a higher yield.
Sources & Rate Verification
Rates verified against official statutory guidance on 6 September 2026.