Airbnb Yield Calculator

AirBnb Yield Calculator

Use this basic gross yield calculator to understand the potential gross yield of any airbnb investment property. Simply enter the purchase price of the property, the estimated occupancy, and the estimated nightly rate.

Gross vs Net Yield

In the context of short-term rental investment properties, gross yield and net yield are two important metrics used to evaluate the profitability of an investment.

Gross Yield

- Gross yield represents the total income generated by the property before any expenses are deducted.
- It is typically calculated by dividing the annual rental income by the property’s purchase price or market value, and then expressing the result as a percentage.
- Gross yield gives investors an idea of the potential income the property can generate without considering any associated costs.
- It’s a useful metric for quickly assessing the income potential of a property but doesn’t provide a complete picture of its profitability.

Net Yield

- Net yield takes into account the expenses associated with owning and operating the property.
- It is calculated by subtracting all the expenses (such as levies, rates & taxes, management fees, maintenance costs, utilities, and any other operating expenses, as well as bond repayments) from the total rental income, and then dividing the result by the property’s purchase price or market value.
- Net yield provides a more accurate representation of the actual profitability of the investment after accounting for all the costs associated with owning and managing the property.
- Unlike gross yield, net yield takes into consideration the real-world expenses involved in maintaining and running the rental property, giving investors a clearer picture of their potential return on investment.

In summary, while gross yield gives an indication of the income potential of a short-term rental property, net yield provides a more comprehensive assessment by factoring in all the associated expenses, ultimately reflecting the property’s true profitability.

Gross and net yield are just some of the factors to consider when investing in real estate. However there are many more factors and metrics to consider.