Rental Yield Calculator
Rental yield measures how much annual income a property generates relative to its cost. Gross yield ignores expenses; net yield accounts for vacancy, maintenance, property tax, and management costs — giving the real return. Use this before buying an investment property.
Frequently Asked Questions
What is a good rental yield in India?+
Gross yields in major Indian cities: Mumbai 2–3%, Delhi NCR 2–4%, Bengaluru 3–4%, Pune 3–4%, Hyderabad 3–5%, Chennai 3–4%. Net yields (after expenses and vacancy) are typically 1–2% lower. India's rental yields are generally low compared to property prices, meaning the investment case depends heavily on capital appreciation.
What expenses should I include in net yield?+
Include: society maintenance charges, property tax, home insurance, minor repairs/painting between tenants, brokerage for finding tenants (1–2 months rent), property management fee (8–12% if using a manager), and occasional major repairs. Factor 1–2 months vacancy per year (8–16% vacancy rate).
Should I buy property for rental income or capital appreciation?+
In India, residential real estate primarily creates wealth through capital appreciation (5–12% p.a. in good locations), not rental yield (2–4%). The math typically works better than it appears only when appreciation is strong. Commercial property (offices, shops) gives higher yields (6–9%) but higher entry costs and management complexity.
How does rental income get taxed?+
Rental income is taxed as "Income from House Property." Standard deduction of 30% of net annual value (NAV) is allowed automatically. Home loan interest on let-out property is fully deductible (no ₹2L cap unlike self-occupied). Net taxable rental income is added to your total income and taxed at slab rate.