Calculator
Rental yield and ROI calculator.
Gross yield is the headline. Net yield, cash flow after finance and return on the cash you actually put in are what decide whether a deal works.
Gross yield
7.2%
£21,600 rent a year
Net yield
5.4%
after voids and running costs, before mortgage
Monthly cash flow
£322
after £1,031 a month mortgage
Return on cash invested
3.9%
£100,000 cash in
Interest cover 175%. Buy-to-let lenders typically want rent to cover 125% to 145% of the interest at a stressed rate. HMO and serviced accommodation lenders may value on the commercial income instead, which is one of the reasons those strategies can support more borrowing.
A gross yield tells you little on its own. Net yield and cash flow after finance are what you live on, and the return on cash invested is what you compare against other uses of the same money.
Rates and thresholds for England and Northern Ireland, checked against gov.uk on 9 September 2026. These calculators are for guidance only and are not tax, legal or financial advice. Your own position may differ; confirm figures with your accountant, solicitor or lender before relying on them.
Gross yield, net yield, return on cash
Gross yield is annual rent divided by price. It is easy to quote and easy to flatter. Net yield deducts voids and running costs, which for an HMO with bills included can be a third of the rent. Return on cash invested divides the annual cash flow after the mortgage by the deposit and purchase costs, and is the number to compare against other things you could do with the same money.
Why HMOs and serviced accommodation look different
Room-by-room letting and short lets usually produce a higher gross yield but carry higher costs: bills, furnishing, cleaning, licensing, management time and more frequent voids. They can also be valued and financed on their commercial income rather than bricks-and-mortar value, which changes how much you can borrow. Put realistic costs in and the comparison with a standard let becomes honest.
Interest cover
Lenders typically require rent to cover 125% to 145% of the mortgage interest at a stressed rate. If the cover shown here is below that, expect the maximum loan to be reduced or the lender to ask for a bigger deposit.
Want a second pair of eyes on the numbers?
A free 15-minute call is often enough to spot the thing the calculator cannot: the licensing issue, the lender that will not like the property, the tax angle you had not considered.