Calculate gross and net rental yield on Australian investment property. Includes operating expenses, vacancy allowance, and a true yield on total invested capital including stamp duty.
Gross & net yieldVacancy-adjustedTrue yield on capital
01 —INPUTS
Property Details
Allow 2–4 weeks for vacancy (enter 48–50)
Typical 7–8% plus letting fee
Annual Expenses
Typical $1,500–$2,500 per year
Typical $800–$1,200
$0 for houses; $2,000–$6,000 for units
Typical $900–$1,500
Budget ~1% of property value per year
Varies by state and land value — $0 if below threshold
Stamp duty + conveyancing + inspections. Used for the "true yield" figure.
Gross yield is a fast, rough benchmark. Net yield is what you actually earn after running costs. True yield compares the property against investments that don't carry a 4–6% acquisition cost up front.
Worked example
$800k Sydney house, $600/week rent
Stamp duty, conveyancing, and inspections add $45,000. Council rates $2,000, water $1,000, insurance $1,200, maintenance $2,000, no strata, 7.5% management. Allow 2 weeks vacancy.
At a 2.69% net yield, this property needs capital growth to justify the investment. A leveraged investor should also subtract loan interest — see the negative gearing calculator.
Yield vs other property metrics
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Yield — Annual rent return on property value — what this calculator computes.
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Cash-on-cash return — Cashflow after mortgage divided by deposit + purchase costs.
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Total ROI — Yield plus capital growth, adjusted for leverage.
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After-tax cashflow — Net income after tax deductions and your marginal rate.
FAQ
What is a good rental yield in Australia?
Capital-city houses typically produce gross yields of 2.5%–4%, while units sit around 4%–5%. Regional markets can exceed 5%–6%. After expenses, 'good' net yields are roughly 3.5%+ for capital cities and 4.5%+ for regional areas.
What is the difference between gross and net rental yield?
Gross yield is annual rent divided by property price — it ignores every cost. Net yield subtracts operating expenses (rates, strata, insurance, management, maintenance, vacancy) before dividing. Net yield is what actually reaches your pocket; gross is a quick benchmark.
Should I include stamp duty and acquisition costs?
Serious investors use a 'true yield' on total invested capital — property price plus stamp duty, conveyancing, building inspections, and loan establishment. This gives a more honest comparison against other investments where you don't pay a 5% acquisition cost up front.
How do I allow for vacancy?
The Australian industry standard is 2–4 weeks of vacancy per year. Set 'weeks rented' to 48–50 to model this. New builds, apartments in oversupplied markets, and properties with above-market rent tend toward the higher end of vacancy.
Does this include tax deductions or loan interest?
No — rental yield is a pre-tax, pre-mortgage measure of the property's raw earning power. To see your after-tax cashflow including loan interest, depreciation, and negative gearing benefits, use our investment property calculator or negative gearing calculator.
What expenses should I include?
Council rates, water rates (owner portion), landlord insurance, body corporate / strata (units only), property management fees (typically 7–8% plus letting fee), repairs and maintenance (rule of thumb ~1% of property value), land tax (if above your state's threshold), and any other ongoing costs like pest control or advertising.
Is rental yield the same as ROI?
No. Yield measures rental income return against the property value. ROI measures total return on your cash invested, including capital growth and mortgage leverage. A low-yield property can still have a high ROI if capital growth is strong.
This calculator uses industry-standard rental yield formulas. Expense ranges reflect typical Australian properties but vary by location, age, and condition. Yield is a pre-tax, pre-mortgage measure and does not include depreciation, loan interest, or capital gains tax.