Rental Yield Calculator (USA)
Analyze any rental property: gross & net rental yield, cap rate, net operating income, cash-on-cash return, DSCR, the 1% rule, and monthly cash flow. Includes financing and a rent-sensitivity table so you can stress-test the deal before you buy.
| Rent /mo | Gross yield | Net yield | Cap rate | Cash flow /mo |
|---|---|---|---|---|
| Calculate to see sensitivity | ||||
How to use the rental yield calculator
Four quick steps turn a listing into a full investment read — gross and net yield, cap rate, NOI, cash-on-cash return, DSCR, and the monthly cash flow you’d actually bank.
Enter the property
Purchase price, closing costs, and any rehab or setup spend.
Add rental income
Monthly rent, a realistic vacancy rate, and any other income.
Add costs & financing
Taxes, insurance, maintenance, management, and your mortgage terms.
Read results & save a PDF
See every metric plus a rent-sensitivity table, then download it.
How the numbers are calculated
The calculator builds effective gross income from rent, subtracts operating expenses to reach net operating income, then measures that against price, total investment, and your cash — before layering the mortgage on top. Here is the exact chain of math.
Worked example — $320,000 property, $2,400/mo rent, 25% down at 7.5%
Effective gross income: 28,800 − 1,440 = 27,360
Operating expenses: ≈ 9,229 / yr — 33.7% of income
Net operating income: 27,360 − 9,229 = 18,131
Yields: 9.0% gross · 5.4% net · 5.7% cap rate
Cash flow: 18,131 − 20,137 = −2,006 / yr
A 9.0% gross yield that still loses $167 a month — expenses take a third of the rent, and a 7.5% mortgage costs more than a 5.7% cap rate earns.
Rental yield & return charts
Handy lookups for the questions people ask most — gross yield by rent and price, what the 1% rule demands, how yields move with rent, how leverage changes the return, and what DSCR signals. Ranges are general guidance; markets vary widely.
| Purchase price | $1,800/mo | $2,400/mo | $3,000/mo | $3,600/mo |
|---|---|---|---|---|
| $250,000 | 8.6% | 11.5% | 14.4% | 17.3% |
| $320,000 | 6.8% | 9.0% | 11.3% | 13.5% |
| $400,000 | 5.4% | 7.2% | 9.0% | 10.8% |
| $500,000 | 4.3% | 5.8% | 7.2% | 8.6% |
Gross yield = annual rent ÷ price, before any costs. Expect a third to a half of it to disappear into operating expenses before you reach net yield.
| Purchase price | 0.50% rent | 0.75% rent | 1.00% rent |
|---|---|---|---|
| $250,000 | $1,250 | $1,875 | $2,500 |
| $320,000 | $1,600 | $2,400 | $3,200 |
| $400,000 | $2,000 | $3,000 | $4,000 |
| $500,000 | $2,500 | $3,750 | $5,000 |
A $320,000 property renting at $2,400 sits at 0.75% — short of the rule, but ordinary in mid-priced markets. Treat it as a first-pass filter, not a verdict.
| Monthly rent | Gross yield | Net yield | Cap rate | Cash flow /mo |
|---|---|---|---|---|
| $2,160 (−10%) | 8.1% | 4.7% | 4.9% | −$365 |
| $2,280 (−5%) | 8.6% | 5.0% | 5.3% | −$266 |
| $2,400 (base) | 9.0% | 5.4% | 5.7% | −$167 |
| $2,520 (+5%) | 9.5% | 5.7% | 6.0% | −$68 |
| $2,640 (+10%) | 9.9% | 6.1% | 6.4% | +$31 |
Same property, 25% down at 7.5%. Rent has to climb about 9% before this deal breaks even — which is why stress-testing rent downward matters more than modelling it upward.
| Down payment | Loan | Cash invested | Cash flow /mo | Cash-on-cash |
|---|---|---|---|---|
| 20% | $256,000 | $82,000 | −$279 | −4.1% |
| 25% | $240,000 | $98,000 | −$167 | −2.0% |
| 40% | $192,000 | $146,000 | +$168 | 1.4% |
| 100% | $0 | $338,000 | +$1,511 | 5.4% |
When the cap rate (5.7%) sits below the cost of the debt (7.5%), borrowing shrinks the return instead of amplifying it — negative leverage. Reverse that relationship and every row above flips.
| DSCR | General read | Note |
|---|---|---|
| Under 1.00 | Income won’t cover the mortgage | Negative cash flow |
| 1.00 – 1.20 | Thin coverage | Little cushion |
| 1.20 – 1.25 | Common lender minimum | Acceptable to many lenders |
| 1.25 – 1.50 | Healthy coverage | Comfortable margin |
| 1.50+ | Strong coverage | Well cushioned |
DSCR = NOI ÷ annual debt service. The worked example lands at 0.90× — the property earns 90 cents for every dollar of mortgage payment, and you fund the rest.
gross income
expenses
income
Every return metric traces back to one number. Take rent after vacancy, remove operating expenses, and the net operating income left over sets your net yield, your cap rate, and — once the mortgage comes out — your cash flow.
- Gross yield — rent against price, before a single cost comes out.
- Net yield & cap rate — NOI against what you invested, and against price.
- Cash flow — what’s left after the mortgage, which yield never shows you.
Everything the calculator works out
A handful of inputs give you the full investment picture — the income statement, every return ratio, and a stress test on the rent.
Key figures behind the analysis
Built for any rental analysis
From screening a listing to reviewing a property you already own, the same calculator turns rent and costs into a clear, comparable set of returns.
Comparing listings and needs a fast, consistent read on which ones are worth a closer look.
- Screen on gross yield first
- Use the 1% rule as a filter
- Confirm with net yield and cash flow
Buying without a mortgage, so cap rate and net yield are the whole story and every dollar of NOI counts.
- Set down payment to 100%
- Compare cap rate locally
- Watch the expense ratio
Financing the purchase, so the gap between cap rate and mortgage rate decides whether the deal works at all.
- Test different down payments
- Keep DSCR above 1.20
- Stress-test the rent downward
7 tips for analyzing rental yield
A few habits keep your yield honest and your cash flow projections realistic.
Rental yield calculator FAQ
The definition, calculation, and return questions people ask most about rental yield, cap rate, and cash flow.
Rental yield is the annual rental income a property produces as a percentage of what it cost. It’s the standard way to compare rentals at different prices on the same footing.
A property renting for $2,400 a month brings in $28,800 a year, which against a $320,000 price is a 9% gross yield. Yield says nothing about financing, so two investors with the same property and different mortgages share a yield but not a cash flow.
Gross yield divides annual rent by the purchase price and ignores every cost of running the property. Net yield divides net operating income — rent after vacancy and operating expenses — by the total invested, including closing costs and rehab.
The gap is large. A 9% gross yield can land near 5% net once taxes, insurance, maintenance, management, and vacancy come out. Gross yield is for screening; net yield is for deciding.
It depends entirely on the market, and comparing yields across cities is misleading. Expensive coastal markets often show low single-digit gross yields because buyers are paying for expected appreciation, while lower-priced markets can show double digits alongside more operational risk and slower value growth.
The useful test is a property against similar properties in the same area — then checking whether net yield and cash flow still work after realistic expenses.
They’re close cousins with different denominators. Cap rate divides net operating income by the purchase price or market value. Net yield divides the same NOI by everything you put into the deal, including closing costs and rehab.
That makes net yield slightly lower than cap rate on the same property, and a more honest measure of what your money bought. Both exclude the mortgage, so neither tells you whether the property will cash flow.
The 1% rule says monthly rent should be at least 1 percent of the purchase price. A $320,000 property would need $3,200 a month to pass.
It’s a rough screening filter, not an underwriting standard. In many markets almost nothing clears it, so failing the rule doesn’t automatically make a property a bad investment — run the actual expenses, financing, and cash flow before deciding.
Because yield and cap rate are measured before the mortgage. When the cap rate is lower than the effective cost of the debt, borrowing subtracts from returns rather than adding to them — negative leverage.
A property at a 5.7% cap rate with a 7.5% mortgage pays the lender more each year than the property earns, so cash flow goes negative even though the yield looks respectable. More money down, a lower rate, or higher rent closes the gap.
The debt service coverage ratio is net operating income divided by annual mortgage payments. It shows how comfortably the property covers its own debt, and lenders use it to size loans.
Most want at least 1.20–1.25, meaning the property earns $1.20 to $1.25 for every dollar of payment. Below 1.00 it doesn’t cover the loan on its own, and the shortfall comes out of your pocket every month.
Every recurring cost of operating the property: property taxes, insurance, HOA dues, repairs and maintenance, management, and any owner-paid utilities, plus a vacancy allowance.
Leave out the mortgage payment, income taxes, and depreciation — those are financing and accounting items, not the cost of running the building. Budget maintenance and management even if you’ll handle both yourself, so the numbers stay comparable to a managed property.
General Estimating Notice: This calculator computes gross and net rental yield, net operating income, cap rate, cash-on-cash return, DSCR, and monthly cash flow from the income, expenses, and financing you enter. Figures exclude income taxes, depreciation, and appreciation, and results depend entirely on the accuracy of your inputs and assumptions. Rents, expenses, vacancy, and lender terms vary by property and market. Figures are illustrations, not a valuation, appraisal, or financial, tax, or investment advice. Verify every figure against actual operating statements and consult a licensed advisor before making an investment decision. For planning purposes only.