Research Hub
Rental Yield Explained
Rental yield measures the income a property produces relative to its value. Knowing the difference between gross and net yield helps you compare investments honestly.
Gross versus net yield
Gross yield is the annual rent divided by the property's value, expressed as a percentage. It is quick to calculate but ignores costs. Net yield subtracts expenses such as rates, insurance, management fees, and maintenance, giving a more realistic picture of the income you actually keep.
When you see a yield quoted, it pays to ask whether it is gross or net, because the two can differ significantly.
Yield versus growth
A high yield is not automatically better. Some properties offer strong income but slower value growth, while others do the reverse. The right balance depends on your strategy, cash flow needs, and time horizon.
Getting reliable figures
Rents and values change, so yields date quickly. We explain how to calculate and interpret yield here, and provide current figures for your areas of interest on your discovery call.
Related reading
- Property manager introductions — professionals who help you achieve market rent.
- How to buy an investment property — how yield fits into the purchase decision.
Frequently asked questions
Is a higher yield always better?
Not necessarily. High yield can come with slower growth or higher costs. The right balance depends on your goals and circumstances.
Should I use gross or net yield to compare?
Net yield gives a truer picture because it accounts for expenses, though gross yield is fine for a quick first comparison.