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Rental Property Calculator

See a rental property’s cash flow, gross and net yield, and the return on the cash you put in, after the mortgage and running costs in Canada.

$
$
$

A month

%
More options· Running costs, empty weeks and buying costs
%

% of the year

%

% of rent

%

% of price a year

$

A year

$

A year

$

A month

%

Taxes and fees, % of price

It costs you

$1,904/mo

Rent left after the mortgage and running costs, before tax

Gross yield
5.2%
Net yield
1.7%

What this means

You’d top it up by $1,904 a month. It would pay for itself at a rent of about $4,756 a month. On the $132,000 you put in, that’s a -17.3% cash return in the first year, before any rise in the property’s value.

Rental income is taxed at your marginal rate after expenses. Rentals need at least 20% down.

Next step

The first year

Rent collected$29,952
Property management−$2,396
Repairs and upkeep−$6,000
Insurance−$1,800
Property tax−$4,800
Condo fees−$4,800
Mortgage payments−$33,005
Cash flow-$22,849

What the numbers mean

  • Gross yield: a year’s rent as a share of the price. Quick to compare, but ignores costs.
  • Net yield: rent after running costs, before the mortgage.
  • Cash return: cash flow as a share of the deposit and buying costs you put in.
Assumptions in this estimate
  • The first year only, before tax. Rents, rates and costs change, and you’ll also gain or lose as the property’s value changes.
  • Mortgage payments include paying off the loan on a repayment mortgage: that part builds your equity rather than being a cost.
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How the calculator works

  1. Price, deposit and mortgage rate, and whether the mortgage is repayment or interest-only.
  2. Rent, and the share of the year it might be empty.
  3. Running costs: management, repairs, insurance, property tax or rates, and any strata or service charges.

Example

A $600,000 condo with 20% down at 4.8%, renting for $2,600 a month, with property tax, $400 of condo fees and an 8% management fee:

Result
Cash flow a month -$1,904
Gross yield 5.2%
Net yield 1.7%

These are first-year figures, before tax and any change in the property’s value.

Last updated

Frequently asked questions

What is a good rental yield?

It depends on the area: cheaper areas often have higher yields but slower price growth. A gross yield of 5% to 7% is common; compare the net yield, after costs, between properties.

What is the difference between gross and net yield?

Gross yield is a year’s rent as a share of the price. Net yield takes off running costs such as repairs, insurance, rates or property tax, and management, but not the mortgage.

Why is my cash flow negative?

At today’s interest rates, rent often doesn’t cover the mortgage and costs, especially with a small deposit. Investors then rely on the property’s value rising, which isn’t guaranteed.

How is rental income taxed in Canada?

Rent minus expenses and mortgage interest is added to your income and taxed at your marginal rate. Capital cost allowance (depreciation) can reduce it, but may be taxed back when you sell.