Gross rental yield: Using Gross Rental Yield as a First Screen
Gross rental yield compares annual rent with purchase price. It offers a quick income-to-price measure before considering the property's operating costs.
Use the Gross rental yield Calculator to enter your own figures and compare the result with the worked example below.
Gross rental yield formula
Gross yield (%) = Annual rent ÷ Purchase price × 100
Worked example
| Item | Example value |
|---|---|
| Annual rent | 24000 USD |
| Purchase price | 300000 USD |
| Gross rental yield | 8% |
These are illustrative inputs, not current prices, rates or recommended targets. Where a currency is shown, keep all comparable money amounts in the same currency; conversion examples identify the two sides separately.
How to interpret the result
Gross yield is not take-home return. Vacancy, repairs, management fees, financing and purchase costs can materially change the result.
Related calculations
Method and further reading
The example follows the FinMathly calculator method. For broader background, see CFPB: Building a budget. The background resource may use jurisdiction-specific terms; it does not replace the assumptions of this calculator.
Featured photograph: Pexels.