Buy-to-Let Calculator: Estimate Gross Yield, Net Yield, and Cash Flow

What a Buy-to-Let Calculator Measures

A buy-to-let calculator estimates whether a rental property produces enough income after expenses and mortgage costs. For UK investors, the most common outputs are gross yield, net yield, monthly cash flow, and cash return.

Gross yield is quick, but it is not enough. Net yield and cash flow are more useful because they include the costs of operating the property.

Gross Yield and Net Yield

Gross yield uses rent and price only. Net yield subtracts operating expenses first, so it is closer to the income the property actually produces before financing.

Costs to Include

• Mortgage interest or payment assumptions.
• Letting agent fees and management fees.
• Repairs, maintenance, service charges, and ground rent if applicable.
• Insurance, compliance, licensing, and safety checks.
• Void periods and conservative rent assumptions.

Worked Example

If a property costs GBP 240,000 and rents for GBP 1,400 per month, annual rent is GBP 16,800 and gross yield is 7%. If annual operating expenses are GBP 4,200, net income before finance is GBP 12,600 and net yield is 5.25%.

Mortgage costs can then turn that net income into positive or negative cash flow depending on rate, deposit, and repayment structure.

How to Use the Result

Use gross yield for a quick screen, then net yield and cash flow for actual decision-making. A property with high gross yield can still be weak if service charges, repairs, or void periods are high.

For portfolio planning, compare yield against risk, location, tenant demand, tax position, and exit options. The calculator is a starting point for diligence, not a substitute for advice.

Frequently Asked Questions