Rental yield is the annual rental income earned or expected to earn as the return of investment on a property. It is expressed as the percentage of the property value you invested or are expecting to invest. Knowing the rental yield tells the property investors if their investment is or will be a good decision or not. It exactly represents the measure of their investment. A good rental yield is considered to be around 4%. Rental yield is considered to be one of the property buying decision factors for investors as they can compare the properties and shortlist the ones with better potential.
There is a simple formula that is employed to calculator rental yield of a property:
Rental yield = (Monthly rental income x 12) ÷ Property value * 100
The formula is as straightforward as it looks. Multiply your monthly rental income or expected monthly rental income by 12 and divide the total amount by the property value to get your rental yield.
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Undoubtedly, the best way is the easiest yet most accurate one. Our rental return calculator UK will never disappoint you. So, no more banging your head on the formula, use our rental yield/ buy-to-let yield calculator for an easier, quicker and accurate. computation.
Note: The figures obtained using this free rental yield calculator UK are purely based on the values entered.