Rental Yield Calculator
Screen listings in seconds: gross yield, net yield after costs, gross rent multiplier and the 1% rule — the four numbers investors glance at before doing a full analysis.
Gross vs net yield
Gross yield only looks at rent against price, so it’s the number you’ll see advertised. Net yield subtracts vacancy and operating costs and adds purchase costs to the price, which is why it’s the one that predicts what you’ll earn. Net yield on an unleveraged property is essentially its cap rate computed on your all-in cost.
1% rule quick table
Monthly rent a property needs to hit the 1% rule and a more realistic 0.8% bar in many metros:
| All-in price | 1% rent | 0.8% rent | Gross yield at 1% |
|---|---|---|---|
| $100,000 | $1,000 | $800 | 12% |
| $150,000 | $1,500 | $1,200 | 12% |
| $200,000 | $2,000 | $1,600 | 12% |
| $250,000 | $2,500 | $2,000 | 12% |
| $300,000 | $3,000 | $2,400 | 12% |
| $400,000 | $4,000 | $3,200 | 12% |
| $500,000 | $5,000 | $4,000 | 12% |
Using GRM to sanity-check a price
If comparable rentals in a neighbourhood sell around a GRM of 11 and a listing asks for a GRM of 15, it’s either priced for appreciation or overpriced for an investor. Because GRM ignores expenses, always follow up with the NOI calculator or the full rental analysis.
Questions investors ask
How do you calculate rental yield?
Gross rental yield = annual rent ÷ property price × 100. Net rental yield = (annual rent − vacancy − operating expenses) ÷ (price + purchase costs) × 100. A $300,000 home renting for $2,000 a month has an 8% gross yield.
What is a good rental yield?
Gross yields of 7–10% are generally considered solid for US single-family rentals; net yields usually land 2–4 points lower after expenses. Expensive coastal cities often show gross yields of 4–5%, where investors are relying more on appreciation.
What is the gross rent multiplier (GRM)?
GRM = price ÷ annual gross rent. It is the inverse of gross yield: a GRM of 12.5 equals an 8% gross yield. Lower GRMs mean more rent per dollar of price. Appraisers use local GRMs as a quick income-based value check.
What is the 1% rule in real estate?
The 1% rule says monthly rent should be at least 1% of the purchase price (plus upfront repairs) for a rental to have a chance of positive cash flow with a mortgage. A $200,000 house should rent for $2,000. It is a screening shortcut; high-priced markets rarely meet it and high-rent low-price markets can still lose money on expenses.