Understanding the gross yield is vital for all landlords to understand if a buy to let property is going to work for you.

Gross yield is based on the rental income you receive from letting out the property before costs and places that figure against the cost of buying the property itself. The final figure, usually expressed as a percentage, gives you your yield. Once you have this figure you can then compare potential properties to see which might be the best investment.

The most popular way of working out yield is to take your annual rental income (actual or predicted depending on if you own the property or are looking to buy) and divide it by the purchase price of the property, like this:

  • Annual rent: £9,600
  • Property purchase cost: £200,000
  • Gross yield: 4.8% (£9,600/£200,000)

Our rental yield calculator can help you do this quickly and simply, so why not give it try now?

Please remember that it is just a guide and it's always best to talk this through with an expert - contact ESPC Lettings today!

Rental yield based on property purchase cost

Rental yield: 0%