Rental Yield Calculator UK

Gross yield, net yield and cash-on-cash return — the three numbers that matter for a UK buy-to-let.

Property

£
£

Annual gross: £14,400

2-4 weeks is a sensible UK assumption.

£

Excludes mortgage interest. Typical: 10-15% of gross rent for a managed BTL.

If leveraged

£

BTL mortgages typically need 25% minimum. Higher deposits get better rates.

%

Calculator uses interest-only (typical for BTL).

Gross yield
5.76%
Annual rent / price
Net yield
4.34%
After voids & costs
Cash-on-cash
0.85%
After mortgage interest

Annual cash flow

Gross rent (£1,200/month × 12)£14,400
Void loss (2 weeks)-£554
Operating costs-£3,000
Mortgage interest (5.5% on £187,500)-£10,313
Net rental profit (pre-tax)£534
This is the pre-tax profit. UK BTL profit is taxed at income tax rates; mortgage-interest tax relief is restricted to a 20% credit (Section 24).
Mortgage interest is not tax-deductible. Since 2020 individual landlords can't deduct mortgage interest from rental profit. Instead you get a 20% tax credit. For higher-rate landlords this means much of the "cash-on-cash" advantage of leverage is lost.

Understanding rental yields

Three different ways to express the same investment, each useful for a different question:

  • Gross yield compares like-for-like across cash and leveraged purchases — useful when comparing properties.
  • Net yield tells you the property's real income return ignoring how you finance it — useful for cash buyers.
  • Cash-on-cash measures return on the actual cash you put in — what matters most to a leveraged BTL investor.

For a typical UK BTL with 75% LTV and a 5.5% mortgage rate, the cash-on-cash number can be 3-4× the gross yield. That's the leverage doing its job (and amplifying losses on the downside too).

  • < 4% gross — typical prime central London. Most of the return is expected from capital growth, not income.
  • 4-6% gross — outer London, the South East and many UK suburbs. Mixed strategy.
  • 6-9% gross — Midlands, North, regional cities. Income-focused, slower capital growth.
  • 9%+ gross — HMOs, holiday lets, properties with material issues. Higher operational risk and management.

Related calculators

Other free UK tools that follow on from this calculation.

Buy-to-Let Calculator

Rental yield, ROI, SDLT surcharge and Section 24 mortgage interest restrictions.

Mortgage Calculator

Monthly repayments, total interest and LTV for any UK mortgage scenario.

Stamp Duty Calculator

SDLT for England & NI with post-April-2025 bands, plus Scotland LBTT and Wales LTT.

Mortgage Affordability Calculator

How much UK lenders will typically offer at 4.5×, 5× or 5.5× income with your deposit.