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Short-term rental ROI and yield calculator

Is this property worth buying as a rental?

Example figures. Replace them with yours.

Include stamp duty, legal fees and what furnishing it cost.

Per booked night, with the cleaning fee spread across the stay.

Share of the 365 nights that book, once the listing is established.

Sets how many turnovers a year of bookings costs.

Cleaning, laundry and guest supplies for one turnover.

Insurance, property tax, building fees, utilities, internet, software, routine maintenance.

More assumptions (3)

A new listing takes time to collect reviews. Enter 0 for an established one.

Platform host fee plus any management fee charged as a share of revenue.

Furniture, mattresses, linen and appliances wear out faster than in a long let. Set this aside apart from routine repairs.

Currency changes the symbol only. Nothing is converted, so enter every figure in one currency.

Your result

Net yield

6.28%

Gross yieldThe number listings quote. It ignores every cost.
14.05%
Payback period
15.93 years
Full breakdown
Gross revenue
$56,210
Gross yieldThe number listings quote. It ignores every cost.
14.05%
Net operating incomeBefore income tax.
$25,114
Net yield
6.28%
Payback period
15.93 years
Net operating income, first yearWhile the listing builds up to the occupancy entered.
$20,099
Break-even occupancyBelow this, the property loses money before tax.
26.18%
Worse case: 56% occupancyNet yield. Net operating income $17,091; payback 23.4 years.
4.27%
Better case: 84% occupancyNet yield. Net operating income $33,136; payback 12.07 years.
8.28%

What this assumes

  • Revenue = nightly rate × booked nights, where booked nights = occupancy × 365.
  • Variable costs move with bookings: the fees taken from revenue, and the cost per stay × stays, where stays = booked nights ÷ average stay. Fixed costs and the replacement reserve are paid whether anyone books or not.
  • Net operating income = revenue − variable costs − fixed costs − replacement reserve.
  • Gross yield = revenue ÷ price. Net yield = net operating income ÷ price.
  • Payback = price ÷ net operating income, in years, from a full year at the occupancy entered.
  • First year: occupancy averages half its steady level during the ramp-up months.
  • Break-even occupancy is where net operating income reaches zero. The two scenarios move occupancy 20% either way, capped at 100%, and change nothing else.
  • Before income tax, which depends on your country and circumstances.
  • Cash purchase. A mortgage changes both the money at risk and the return on it, and this does not model financing.
  • No capital growth, no depreciation, no sale costs. It measures the property as an income stream and nothing else.

An estimate, not advice. It cannot know your market, your local rules or your tax position. Check the figures against your own booking data before acting on them.

How it works

This short-term rental ROI calculator turns a purchase price and a year of bookings into rental yield and a payback period. Gross yield is the figure that appears in listings and the least useful one, because it ignores every cost. The gap between it and net yield is the whole question, and on a short-term rental that gap is much wider than on a long-term rental, or long let: commission, cleaning and turnover churn are real money and they scale with bookings.

This models a cash purchase and an income stream. It does not model financing, capital growth or the cost of selling, and it will not tell you whether the local rules permit short-term rentals at all — which, in a growing number of cities, is the question that decides the rest.

Gross yield, net yield and payback period

Gross yield is a year of revenue as a share of the purchase price. Net yield takes off the fees taken from revenue, the cost of each stay, fixed costs and a replacement reserve first. On a cash purchase, net yield is what investors call the cap rate. The payback period is the price divided by a year of net operating income: how many years of that income it takes to buy the property back.

It works as an Airbnb ROI calculator or an Airbnb investment calculator, and as a vacation rental ROI calculator for holiday lets, because it starts from your own figures rather than a platform’s data. It models no mortgage, so it says nothing about leverage.

Common questions

Is this property worth buying as a rental?

Net yield and the payback period are the honest starting point, because gross yield ignores every cost. Compare the net yield with what the same money would earn elsewhere, and check first that local rules allow short-term rentals at the address.

What is the difference between gross and net yield?

Gross yield is revenue divided by the price. Net yield is what is left after fees, cleaning, fixed costs and a replacement reserve, divided by the price. On a short-term rental the gap is wide, because commission and cleaning grow with every booking.

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Nothing you type here leaves your browser. There is no server to send it to — this page is a static file, and the calculation happens on your own device.

RentalWe is not affiliated with Airbnb. The names are used only to describe the platforms and tools hosts use.

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