Rental yield
The annual rental return of an investment property expressed as a percentage of its value. Gross yield uses rent before expenses; net yield uses rent after operating costs but before tax and financing.
Rental yield is the simplest way to compare the income performance of two investment properties. Gross yield divides annual rent by the property value (or purchase price); net yield subtracts operating expenses such as rates, insurance, management fees, and maintenance before dividing. Neither figure accounts for mortgage interest or tax, which are treated separately in a full after-tax return calculation.
Yield conventions differ by market. New Zealand investors typically quote gross yield on purchase price, while Australian investors often see yield quoted on current market value — the two are not comparable without adjusting.
Yield is only one lens on an investment. A low-yield, high-capital-growth market behaves very differently from a high-yield, low-growth one, and the tax treatment in each country — ring-fencing in New Zealand, negative gearing in Australia — changes how net cash flow flows through to the investor’s wallet.
Primary source
Moneysmart (ASIC) — Buying an investment property →Last reviewed 15 April 2026. Rates, thresholds, and deadlines change — always verify against the primary source before making decisions.