The property
Taxes, agent, legal fees — everything paid on top of the price
Refundable deposit held by you — enter 0 if it sits in escrow or is negligible
Loan and running costs (optional)
Management, maintenance reserve — 0 if none
The currency is whatever you enter — every money field must just use the same one. Vacancy, repairs and taxes are not included.
Two yields, side by side
The yield printed in a property listing is usually the gross one: annual rent divided by the purchase price. Rent of 1,000 a month on a 300,000 property makes 12,000 a year — a 4% gross yield. It is easy to compute and easy to flatter with, because it ignores purchase costs, the loan and every running expense. Use it only to compare listings roughly.
The yield that matters is on your own cash
Take the rent, subtract loan interest and running costs, and divide by the money you actually put in: price plus purchase costs, minus the deposit you hold and the loan. Borrowing shrinks that denominator, so the same property can show a 4% gross yield and a 9% return on your cash — and exactly the same lever swings the other way when rates rise or the place sits empty.
This is a cash-flow estimate, nothing more
Vacancy between tenants, repairs when they leave, property taxes on holding, and the gain or loss when you eventually sell are all outside this calculation. Rental yield only describes the money flowing while you hold — a full investment decision needs the tax and price outlook on top.
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Frequently asked questions
Q. What belongs in purchase costs?
Everything paid to acquire beyond the price itself: transfer or stamp taxes, agent commission, legal and registration fees. In many countries these add several percent to the price, and since they raise the cash you invested, they quietly lower the true yield.
Q. Why does borrowing more raise the yield?
Interest reduces the income a little while the loan reduces your invested cash a lot — as long as the loan rate is below the property yield, the return on your remaining cash climbs. When the rate rises above the yield, the same lever reverses and can push the result negative. This calculator shows that minus sign rather than hiding it.
Q. What do I put in the deposit field?
A refundable tenant deposit that you hold reduces the cash you have tied up, which is why it is subtracted. If the deposit in your market is small, or the law requires it to sit in an escrow account you cannot touch, enter 0.