Rental Yield Calculator
Calculate gross yield, net yield, and cash-on-cash return for investment property.
Last reviewed: Source: StatsSA — Property indices
Gross vs net yield — don't mix them up
Rental yield is the annual rental income expressed as a percentage of the property value. There are two flavours and they’re usually 30–50% different from each other:
- Gross yield = annual rent ÷ property value. Ignores all expenses. This is what property adverts quote.
- Net yield = (annual rent − annual expenses) ÷ property value. What actually lands in your pocket.
A flat renting for R12,000/month on a R1,500,000 property has an 9.6% gross yield — but once rates, levies, insurance, maintenance, vacancy, and managing-agent fees come out, the net might be closer to 5–6%.
The expenses that eat your yield
Annual expenses you should deduct for a net calculation:
- Rates and taxes (municipal) — typically 0.6–1.2% of property value per year, varies by metro.
- Levies (sectional title, complex, HOA) — can range from R500/month on a small flat to R3,000+ on a security estate.
- Building insurance (and contents if landlord-supplied) — R500–2,000 per month depending on property type and area.
- Maintenance + repairs — budget 1% of property value per year. Some years less, some much more (a geyser failure at R8,000, a roof at R60,000).
- Vacancy allowance — 1 month per year is a safe SA average. That’s 8.3% of gross rent lost to turnover.
- Managing agent (if used) — 8–10% of monthly rent, or a flat monthly fee.
- Income tax — net rental income is taxed at your marginal rate. Often 5–15% of gross rent lost to SARS after other expenses reduce the taxable base.
Typical 2026 SA yields by property type
| Property type | Gross yield range |
|---|---|
| Inner-city apartment (Gauteng/WC) | 10% – 14% |
| Sectional title flat (suburban) | 8% – 11% |
| Freehold house (middle suburb) | 5% – 8% |
| Freehold house (upper-market) | 3% – 5% |
| Coastal holiday property (Cape Town, Garden Route) | 4% – 7% |
| Student accommodation (near university) | 10% – 14% |
Net yields are typically 35–55% lower than gross. Inner-city apartments often have the highest gross but also the highest vacancy and maintenance, so the net narrows the gap.
Worked examples
R1.5m sectional title flat at R12,000/month
Suburban Johannesburg, mid-market body corporate.
- Annual rent (12 × R12,000)
- R144,000
- Gross yield
- 9.6%
- Rates (0.9%)
- −R13,500
- Levies (R2,200/month)
- −R26,400
- Insurance
- −R6,000
- Maintenance 1%
- −R15,000
- Vacancy 1 month
- −R12,000
- Net income
- R71,100
- Net yield
- 4.74%
R2.5m freehold house at R18,000/month
Upper-middle suburb, no body corporate.
- Annual rent
- R216,000
- Gross yield
- 8.64%
- Rates (1.0%)
- −R25,000
- Insurance
- −R10,000
- Maintenance 1%
- −R25,000
- Vacancy 1 month
- −R18,000
- Managing agent 8% of collected rent
- −R15,840
- Net income
- R122,160
- Net yield
- 4.89%
Yield vs return — don't confuse them
Yield is the annual income divided by property value. Return is yield plus capital appreciation. A property with a 5% net yield and 7% annual appreciation has a 12% total return — comparable to equities over long periods.
Low-yield properties in prime areas usually have higher appreciation. High-yield properties in lower-grade areas often have lower (or negative) appreciation. The “total return” can be roughly equal across property tiers — you’re just choosing whether you want the return as income or as capital growth.
What yield tells you vs doesn't
- Yield tells you: the cashflow quality of the property at current rent. Can you comfortably cover the bond + rates + levies from rent alone, or are you topping up monthly?
- Yield doesn’t tell you: future capital growth, tenant quality, maintenance surprises, area trajectory, regulatory risk. A 12% yield in a high-vacancy corridor is often worse than an 8% yield in a stable suburb with waiting-list demand.
How this calculator works
Enter the property value, monthly rent, and expected monthly expenses. The calculator computes gross yield (annualised rent ÷ property value) and net yield (after expenses). Optional tax and vacancy inputs let you see the after-tax cash yield — the real number that hits your bank account every month.
Sources
Frequently Asked Questions
Gross yields of 8–12% are considered good. Net yields (after expenses) of 6–8% are strong. Anything below 5% net may not justify the investment risk and effort.
Rates, levies, insurance, maintenance, agent fees (typically 5–10% of rent), vacancy allowance (budget 1 month per year), and bond interest if financed.
Net annual income divided by your cash invested (deposit). If you put down R400K and net R48K/year, your cash-on-cash return is 12% — often higher than the yield because of leverage.
Annual rent divided by property purchase price. If you earn R60,000/year rent on a R1 million property, gross yield is 6%. This does not account for expenses.