UK Rental Yield Calculator
Calculate gross yield, net yield, monthly cash flow and cash-on-cash return on a UK buy-to-let in seconds. Enter the purchase price and rent, adjust the running costs, and see whether the deal stacks up after stamp duty and mortgage interest.
Your numbers
Running costs
Finance & stamp duty
6.27%
Annual rent ÷ purchase price
4.61%
After costs, on total purchase cost
£179
After costs and mortgage interest
3.09%
Cash flow ÷ cash invested
Breakdown
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Analyse a deal freeHow to calculate rental yield in the UK
Gross rental yield is the simplest measure: multiply the monthly rent by 12, divide by the purchase price and multiply by 100. A £220,000 property let at £1,150 a month produces £13,800 a year, which is a gross yield of 6.27%. It is useful for quickly ranking areas, but it ignores every cost of owning the property.
Net rental yield deducts the real cost of running the property — letting agent management fees, a maintenance allowance, a void allowance for empty months, landlord insurance, service charge and ground rent — and measures the result against what the purchase actually cost you, including stamp duty and legal fees. It is usually 1.5 to 3 percentage points lower than gross yield.
Cash flow and cash-on-cash return are what you feel each month. Yield says nothing about your mortgage; cash flow subtracts the interest, and cash-on-cash return divides the leftover profit by the deposit, stamp duty and fees you put in. A 6% gross yield deal can still be cash-flow negative at a 5.25% mortgage rate on a 75% loan.
Stamp duty matters more than most calculators admit. On an additional property in England and Northern Ireland the surcharge applies from the first pound, so a modest purchase can carry a five-figure tax bill that quietly drags your return down. This calculator estimates it for you using the current bands.
Gross yield vs net yield
| Metric | Formula | Best for |
|---|---|---|
| Gross yield | (Annual rent ÷ Price) × 100 | Quick area comparison |
| Net yield | (Annual rent − Costs) ÷ Total invested × 100 | Real deal comparison |
| Cash-on-cash return | Annual cash flow ÷ Cash invested × 100 | How hard your money works |
What is a good rental yield in the UK?
A "good" rental yield depends on where you are buying and what you are trying to achieve. In London and the South East, a gross yield of 3-5% is typical and investors often accept it because they expect stronger capital growth. In the Midlands, North of England, Scotland and parts of Wales, gross yields of 6-9% are more common.
The number to focus on is net yield after costs, and whether the property produces positive monthly cash flow at today's mortgage rates. A property with a 7% gross yield but high service charges and a large stamp duty bill can easily end up with a 4% net yield and negative cash flow.
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Rental yield questions
What is a good rental yield in the UK?
Most UK buy-to-let investors look for a gross yield of 5-8%. Yields below 4% are common in London and the South East, where investors rely more on capital growth, while parts of the North and Midlands regularly exceed 7%. What matters most is net yield after costs and whether the deal still produces positive cash flow at your mortgage rate.
How do you calculate rental yield in the UK?
Gross rental yield = (annual rent / purchase price) x 100. Net rental yield = (annual rent minus running costs such as management, maintenance, insurance, service charge, ground rent and void allowance, divided by the total purchase cost including stamp duty and fees) x 100. Use a rental yield calculator to handle the numbers automatically.
How do you calculate net rental yield?
Net rental yield deducts all operating costs from the annual rent, then divides the result by the total cash cost of buying the property. Operating costs include letting agent fees, maintenance, void allowance, landlord insurance, service charge and ground rent. The purchase cost includes the price plus stamp duty, legal fees and any refurbishment.
What is the difference between gross and net yield?
Gross yield ignores every cost apart from the price you pay. Net yield subtracts operating costs and, in this calculator, also accounts for stamp duty, legal and survey fees in the total invested. Net yield is the realistic number to compare deals with.
Does rental yield include mortgage payments?
No. Yield measures the property's income performance regardless of how it is financed. Mortgage interest affects your cash flow and cash-on-cash return, which this calculator shows separately.
Is stamp duty included in rental yield?
Not in the standard gross yield calculation. DealLens includes stamp duty and purchase fees in the total cash invested so your cash-on-cash return reflects the real cost of acquiring the property.
What is cash-on-cash return on a rental property?
Cash-on-cash return is the annual cash flow divided by the total cash you put into the deal. It includes your deposit, stamp duty, legal fees and refurbishment. It is the best measure of how hard your actual money is working.
Can I use this calculator for properties in Scotland, Wales and Northern Ireland?
Yes for the yield and cash flow calculations. Stamp duty works differently: England and Northern Ireland use SDLT with the additional property surcharge, Scotland uses LBTT and Wales uses LTT. This calculator uses SDLT bands; if you are buying in Scotland or Wales, treat the stamp duty figure as an estimate and check the local tax bands.
Figures are estimates based on the inputs you provide and are not financial, tax or mortgage advice. See our disclaimer. Try the buy to let calculator and the property ROI calculator.