What is a good rental yield in Australia?

In capital cities, 4-5% gross yield is typical. Regional areas can offer 6-8%+. For net yield, anything above 3% after expenses is generally considered positive.

Gross vs net yield — which matters more?

Net yield is far more important for decision-making as it accounts for real costs. A property with 6% gross yield but 3% net yield is worse than one with 5% gross and 4% net.

What is positive and negative gearing?

Positive gearing means rental income exceeds all costs (including loan interest). Negative gearing means costs exceed income — the loss is tax-deductible against your other income.

Rental Yield Calculator Australia

Calculate gross and net rental yield, and see cash flow at different interest rates

Enter your investment property details to see both gross and net yield, plus a cash flow analysis showing where the property becomes positively or negatively geared.

Property Details

Property Price ($)

Weekly Rent ($)

Annual Expenses ($)

Council rates, insurance, management fees, maintenance, strata, etc.

Vacancy Rate (%)

Average vacancy rate in Australia is around 2-4%

Rental Yield Analysis

Gross Yield

4.33%

Net Yield

3.20%

Gross annual income$26,000

Less vacancy ($780)-$780

Effective annual income$25,220

Net annual income (after expenses)$19,220

Net monthly income$1,602

Expense ratio23.1%

Cash Flow at Different Interest Rates

Assuming 80% LVR, interest-only loan

4%+$20/yr(+$2/mo)

4.5%-$2,380/yr(-$198/mo)

5%-$4,780/yr(-$398/mo)

5.5%-$7,180/yr(-$598/mo)

6%-$9,580/yr(-$798/mo)

6.5%-$11,980/yr(-$998/mo)

7%-$14,380/yr(-$1,198/mo)

7.5%-$16,780/yr(-$1,398/mo)

8%-$19,180/yr(-$1,598/mo)

Cash Flow by Interest Rate

Annual cash flow at different interest rates (80% LVR, interest-only)

How to Use This Calculator

1Enter the property purchase price
2Enter the expected weekly rent
3Add annual expenses (rates, insurance, management, maintenance, strata)
4Set a vacancy rate (2-4% is typical for most Australian markets)
5Review your gross yield, net yield and cash flow at different interest rates

What Is Rental Yield?

Rental yield measures the annual rental income as a percentage of the property's value. Gross yield uses the full rental income, while net yield subtracts expenses like rates, insurance, management fees and vacancy.

A higher net yield means a property generates more income relative to its price. Generally, 4-5% gross yield is considered solid in Australian metro areas, while regional areas may offer 6-8%+.

Key Factors Affecting Rental Yield

Location: Inner-city and capital city properties typically have lower yields (3-4%) but stronger capital growth. Regional areas often offer higher yields (5-8%).
Property type: Units/apartments generally have higher yields than houses due to lower purchase prices relative to rent.
Vacancy rates: A 2-week vacancy per year costs about 4% of your rental income. Markets with low vacancy (<2%) are more reliable.
Expenses: Strata fees (for units), council rates, insurance, property management (typically 7-10% of rent), and maintenance (budget 1-2% of property value) all reduce net yield.

Investment Property Tips

•A gross yield above 5% is generally considered good for a capital city property in Australia
•Don't forget to account for depreciation when calculating your total return — it can significantly improve after-tax returns
•Negative gearing (where expenses exceed income) can provide tax deductions that reduce the true cost of holding
•Always use net yield (not gross) for property comparisons — two properties with the same gross yield can have very different net yields

Frequently Asked Questions

Official Sources

Estimates only. Not financial or tax advice. Full disclaimer for your rights and our limitations of liability.

Rates and thresholds last updated for the 2024–25 financial year.

Related Tools

Mortgage Calculator

Calculate repayments on your investment loan

Stamp Duty Calculator

Upfront costs when purchasing investment property

Capital Gains Tax Calculator

CGT when you sell an investment property

Borrowing Power Calculator

Find out how much you can borrow

Loading calculator…