$
$
$
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
$522/mo
Rent left after the mortgage and running costs, before tax
- Gross yield
- 8.2%
- Net yield
- 4.7%
What this means
You’d top it up by $522 a month. It would pay for itself at a rent of about $2,991 a month. On the $98,000 you put in, that’s a -6.4% cash return in the first year, before any rise in the property’s value.
Rental income is taxed after expenses and depreciation, which often cuts the tax a lot.
The first year
| Rent collected | $27,648 |
| Property management | −$2,212 |
| Repairs and upkeep | −$3,500 |
| Insurance | −$1,800 |
| Property tax | −$3,850 |
| Mortgage payments | −$22,545 |
| Cash flow | -$6,259 |
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.