How is rental yield calculated for properties in Singapore?

Rental yield is calculated as a percentage that shows the annual income you earn from renting out a property relative to its value.

The two main formulas are:

Gross Rental Yield = (Annual rental income ÷ Property value) × 100

This is the simplest calculation. For example, if a property costs $500,000 and generates $20,000 in annual rent, the gross yield is 4%.

Net Rental Yield = (Annual rental income − Annual expenses) ÷ Property value × 100

This provides a more realistic picture by accounting for costs like property tax, condo maintenance fees, repairs, and agent commissions. These expenses can significantly reduce your actual returns.

For Singapore properties, gross rental yields on private condos in city-fringe areas typically range from 3–4%, while net yields are usually lower after accounting for maintenance and other costs. In older HDB towns, yields may be slightly higher, though you must comply with HDB's Minimum Occupation Period and rental rules.

Why basic yield isn't enough: Smart investors also calculate cash-on-cash return, which factors in your actual cash outlay including down payment, stamp duties, renovation costs, and loan interest. This often reveals that while a property may show a 4% gross yield on paper, your real cash-on-cash return could be less than 1% once all costs are considered.

For detailed rental yield calculations specific to your property, EdgeProp Singapore offers a free rental yield calculator as part of its suite of property analysis tools.