Gross yield is the quick screen; net yield is the honest number. This calculator shows both at once so you can see how much the expenses change the story.
Rental yield is the simplest income measure in real estate, common in international markets and quick enough to run in your head while browsing listings.
Gross yield = annual rent ÷ purchase price. A $250,000 property renting for $2,100 a month collects $25,200 a year, a 10.08% gross yield.
Net yield = (annual rent minus operating expenses) ÷ purchase price. Subtract the $9,500 of taxes, insurance, vacancy and upkeep in the default example and the same property nets $15,700, a 6.28% net yield. Net yield is essentially a simplified cap rate, and it is the honest one of the pair.
The classic 1% rule (monthly rent at least 1% of price) is just a 12% gross yield restated. Both are screens, not verdicts: they ignore financing, expenses that vary wildly by property age, and taxes that get reassessed when you buy. Use yield to rank markets and listings quickly, then run the survivors through a full analysis.
| Gross yield | Where you usually see it |
|---|---|
| 3% to 5% | Expensive coastal metros; the bet is appreciation, not income |
| 6% to 8% | Most balanced US markets |
| 9%+ | Cash-flow markets and rougher property classes; verify why it is cheap |
A yield that looks too good usually is. Ultra-high yields cluster where prices are low for a reason: weak demand, high vacancy, deferred maintenance, or taxes and insurance that eat the difference.
The free DealGauge calculator grades any rental A to F across cash flow, cash-on-cash, financeability and cap rate, then solves the most you could pay and still hit your targets. No account, no email, no property limit.
Grade a deal freeScreen with gross because it is fast, decide with net because it is real. If someone quotes you only gross yield on a property they are selling, ask what the expenses are.
Net yield and cap rate are close cousins; both divide income after expenses by price. Cap rate uses a stricter NOI definition. Gross yield ignores expenses entirely.
Property taxes, insurance, expected vacancy, maintenance, management, and any HOA fees. Leave out the mortgage; yield, like cap rate, is a financing-free measure.
Related: The 1% rule, explained · 1% rule calculator · Cap rate calculator
General information and educational content only, not investment, tax, or legal advice. Benchmarks are common rules of thumb, not guarantees or projected results. Results are estimates from the numbers you enter. Verify every figure and consult a qualified professional before purchasing any property.