Rental Yield Calculator

A good gross rental yield in South Africa is generally 8% or above, while a net rental yield of 5% or more is considered solid. However, this varies by area. Properties in high-demand metro areas like Cape Town or Sandton may have lower yields (4-6% gross) but better capital growth, while properties in secondary cities can offer higher yields (8-12% gross) with less capital appreciation.

Yes, net rental income is added to your total taxable income and taxed at your marginal income tax rate. Net rental income is your gross rental income minus allowable deductions such as rates, levies, insurance, maintenance, management fees, and bond interest (but not the capital portion of bond repayments).

You can deduct levies and body corporate fees, property insurance, municipal rates and taxes, maintenance and repairs (not improvements), property management fees, bond interest (not the capital repayment), advertising costs for finding tenants, and agent commission. Keep all receipts and records for SARS.

Gross rental yield is simply the annual rental income divided by the property value, expressed as a percentage. Net rental yield deducts all property expenses (levies, insurance, rates, maintenance, management fees) from the annual rental before dividing by the property value. Net yield gives a more realistic picture of your actual return on investment.

Bond repayments are not included in the rental yield calculation because yield measures the return on the property itself, regardless of how it is financed. However, bond repayments are crucial for cash flow analysis - this calculator shows your monthly cash flow after bond repayments separately so you can see how much money you actually receive each month.