The simple formula
Gross Rental Yield = (Weekly Rent × 52) ÷ Purchase Price × 100
A property renting at $650/week with a purchase price of $650,000: $650 × 52 = $33,800 annual rent → $33,800 ÷ $650,000 = 5.2% gross yield.
“Gross” means before any costs — no council rates, no property management, no maintenance, no insurance, no interest. It’s the top-line income ratio.
What “gross” hides
Headline gross yield is seductive but incomplete. Net yield — after all expenses — is typically 1.0 to 1.5 percentage points lower. A 5.2% gross yield often becomes a 3.8% net yield once you strip out:
- Council rates & water (~$2,500/yr)
- Strata or body corporate (if applicable)
- Landlord insurance (~$400–800/yr)
- Property management (7–9% of rent)
- Maintenance & repairs (~1% of property value per year)
- Vacancy allowance (2–4 weeks per year)
TopBurb reports both gross and net yields per suburb, so you can see the real cashflow picture.
Typical Australian yield ranges (early 2026)
| City | Median Gross Yield | Range |
|---|---|---|
| Perth | 4.2% | 3.0–6.5% |
| Adelaide | 3.9% | 3.0–5.8% |
| Brisbane | 3.8% | 2.8–5.5% |
| Melbourne | 3.3% | 2.5–4.8% |
| Sydney | 3.1% | 2.2–4.5% |
Regional markets typically run higher — often 5.5–8% gross — but come with lower capital growth and higher vacancy risk.
The yield vs growth trade-off
The classic rule of thumb: high yield and high growth don’t usually coexist.
- High yield, low growth — outer-ring suburbs, regional areas, lower-priced stock. Strong cashflow but slower wealth building.
- Low yield, high growth — inner-ring blue chip, top school zones, lifestyle suburbs. Weak cashflow but strong capital appreciation.
- The sweet spot — “growth corridor” suburbs where population is still expanding but prices haven’t caught up. Perth’s northern and eastern growth corridors have been delivering both for the past 18 months.
Why Perth yields matter right now
Perth is unusual because it’s currently delivering the Australian capital city yield leader position and strong capital growth simultaneously. That combination is rare and likely temporary — historically yields compress as prices outrun rents.
For east coast investors used to 3% Sydney yields, Perth’s 4.5–5.5% suburbs represent a near-doubling of rental income for roughly half the purchase price. That’s the structural arbitrage driving the 23% interstate purchase rate in Perth late 2025.
What yield can’t tell you
Yield is a static snapshot. It tells you what you’ll earn today, not what happens if:
- Rents drop (vacancy rises, new supply arrives)
- Rates rise (holding costs eat margin)
- Growth stalls (your total return depends entirely on cashflow)
A high-yield suburb with deteriorating demographics is often a capital loss waiting to happen. Always pair yield with SEIFA, vacancy, and price growth trends.