Property & finance
Calculation method and formula
12 × Monthly rent ÷ Purchase price × 100
Understand the inputs
- Monthly rent
- Use a measured value or your own assumption.
- Purchase price
- Use a measured value or your own assumption.
Assumptions and limitations
Gross yield, net yield and cash flow answer different questions. Keep rental periods consistent; taxes, financing and vacancies count only when included in the chosen model.
The formula uses the specified units. Displayed numbers are rounded; whole packs, item counts and full time periods may also be rounded within the calculation.