For anyone who is considering buying an investment property, you will surely be interested in what return the property will give you - in other words, its yield.
To calculate yield, you need to follow a few steps to get the property's yield as an annual percentage.
Step 1: Deduct the property's ongoing costs and costs of vacancy (i.e lost rent) from the property's annual rental income (weekly rental * 51)
Step 2: Divide the result of the first step by the property's value.
Step 3: And then, finally, you multiply the result of the second step by 100.
To calculate the gross yield: Annual rental income (weekly rental * 52) / property value * 100.
To calculate the net yield: Annual rental income (weekly rental * 52) - annual expenses and costs/property value * 100
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