Rental Yield Calculator
Calculate gross and net rental yield on your Nigerian property investment. See annual income and monthly cash flow after expenses.
Property Investment Details
₦
₦
₦
Gross Rental Yield
6.00%
Net Rental Yield
5.00%
Annual Net Income
₦2,500,000
Monthly Cash Flow
₦208,333
Annual Rent
₦3,000,000
Annual Expenses
₦500,000
How to Use This Calculator
Enter the property value (purchase price or current market value), annual rent income (what tenants pay per year), and annual expenses (maintenance, property tax, insurance, management fees). The calculator shows both gross and net rental yield.
The Formula
Gross Yield = (Annual Rent ÷ Property Value) × 100
Net Yield = ((Annual Rent − Annual Expenses) ÷ Property Value) × 100
Annual Net Income = Annual Rent − Annual Expenses
Monthly Cash Flow = Annual Net Income ÷ 12
Example
Residential Property in Lekki, Lagos
Property Value₦50,000,000
Annual Rent (3-bedroom flat)₦3,000,000
Annual Expenses (maintenance + tax)₦500,000
Gross Rental Yield6.0%
Net Rental Yield5.0%
Monthly Net Cash Flow₦208,333
A 5–6% net yield is considered good for Nigerian residential real estate. Commercial properties in prime Lagos locations can achieve 8–12% yields. Compare against Treasury Bill rates (~22%) to assess whether the property premium (liquidity, capital appreciation) justifies lower yields.
FAQ
Nigerian rental yield benchmarks: High-end Lagos residential (VI, Ikoyi, Banana Island): 3–5% gross — premium locations with capital appreciation. Mid-range Lagos/Abuja residential: 5–8% gross. Commercial properties (offices, shops): 7–12% gross. Short-let / serviced apartments: 10–20% gross (but higher management costs and vacancy risk). Compare net yield (after expenses) against risk-free alternatives like Treasury Bills (~22% in 2026) — a large premium makes sense only if you expect significant capital appreciation.
Common annual property expenses: Land Use Charge / property tax (0.04–0.13% of value), maintenance and repairs (1–2% of value, higher for older buildings), property management fees (5–10% of annual rent), insurance, service charge (for estate developments), vacancy allowance (budget 1–2 months empty per year), and legal/agency costs for tenant changeover. Many property investors in Nigeria underestimate expenses — use 15–25% of gross rent as a safe total expense budget.
Total property return = rental yield + capital appreciation. Lagos prime locations have seen 10–25% annual capital appreciation in Naira terms (though less in USD). Mid-range areas typically appreciate 8–15% annually. This means total Naira returns can be 15–25% even with modest 5% yield. However, capital appreciation is unrealised until sale, illiquid, and not guaranteed. Yield is the reliable, spendable component — don't rely on appreciation alone to justify an investment.