Rental yield calculator

How do you calculate the Mietrendite (rental yield)?

Gross Mietrendite (rental yield) = annual net rent ÷ purchase price × 100. With a net rent of €950 a month and a purchase price of €250,000 that is €11,400 ÷ €250,000 = 4.56%. The net rental yield first deducts the costs you cannot pass on to the tenant.

The calculation uses the Nettokaltmiete (net rent), which excludes the advance payments for operating costs. You only pass those on, they are not income.

For the gross rental yield you only need two numbers from the listing. Check whether it states the rent actually paid or a hoped-for rent after reletting: the calculator works with whatever you enter.

What is the difference between gross and net rental yield?

The gross rental yield only knows rent and purchase price. The net rental yield is calculated like this: (annual net rent − non-transferable operating costs per year) ÷ purchase price × 100. In the example: (€11,400 − €1,440) ÷ €250,000 = 3.98%.

Administration and maintenance costs cannot be passed on to the tenant (§ 1 Abs. 2 BetrKV, the Operating Costs Ordinance). For a flat these are mainly the property manager fee and the contribution to the maintenance reserve.

The calculator divides by the purchase price. The stricter version divides by purchase price plus closing costs. If you want to calculate that way, enter the sum of both in the purchase price field.

The €120 in the example is an assumption, and the real figures are in the annual service charge statement and the budget plan of the owners association. The calculator does not deduct vacancy or rent default. If you want to allow for them, enter a correspondingly lower net rent.

How do you convert rental yield into a price factor?

Price factor = purchase price ÷ annual net rent = 100 ÷ gross rental yield. A yield of 4.56% equals a factor of 21.93. Listings often quote only the factor: factor 20 means 5%, factor 25 means 4%, factor 30 means 3.33%.

Both figures say the same thing. They are good for comparing offers quickly, but they leave out financing, taxes, vacancy and closing costs.

Two properties with the same gross yield can look very different once those are counted, for instance when the Hausgeld (monthly owner charges) of one is twice as high.