<h2 id="a62f9905-7c58-4b3a-8be2-0bf93c31715e" data-toc-id="a62f9905-7c58-4b3a-8be2-0bf93c31715e">Introduction</h2><p><span>Another tool I use in my Real Estate Rental Journey is: <strong>The Gross Rental Yield</strong>, also known as the Gross Yield, which is a key measure in real estate investment to give a rough estimation of whether buying a property to rent out could be a potentially good deal. It is closely related to the Gross Rental Multiplier - but is the inverse.</span></p><h2 id="1bd07fee-a3cb-4f99-a1b3-1ec8f15f153a" data-toc-id="1bd07fee-a3cb-4f99-a1b3-1ec8f15f153a">Here’s How it works:</h2><ul><li><p style="text-align: start">First, I consider how much money the property potentially will bring in yearly from rent.</p></li><li><p style="text-align: start">Then, I take the property's price tag or how much it costs to buy.</p></li><li><p style="text-align: start">Then I divide the property's annual rent by its property price times 100% to get a percentage.</p><p style="text-align: start"></p></li></ul><h2 id="7e902bc3-8189-4086-9cce-6b31cb949367" data-toc-id="7e902bc3-8189-4086-9cce-6b31cb949367">The Formula:</h2><h3 style="text-align: center" id="4c98a8e6-8593-4d91-a31b-d42efe91876b" data-toc-id="4c98a8e6-8593-4d91-a31b-d42efe91876b"><strong>Gross Rental Yield = (Yearly Rental Income / Purchase Price) x 100%</strong></h3><ul><li><p><strong>A Higher GRM</strong> normally means the property is a better deal. Probably higher returns on my investment.</p></li><li><p><strong>A Lower GRM</strong> normally indicates the property might not be such a great deal because I am paying more for it compared to its rental income. Probably lower returns on my investment</p></li></ul><h1 id="ff21712f-71ed-414a-aa57-748184e3606a" data-toc-id="ff21712f-71ed-414a-aa57-748184e3606a">Conclusion</h1><p style="text-align: start">Once I have the GRY I can calculate different GRYs of various properties in a specific area and compare them. Overall, the GRY helps me as one of my tools, to have a quick method to see if a property is worth my time.</p>

The Gross Rental Yield gives me an idea of how much income the property could bring in compared to what I paid for it. 

How I evaluate Rental Property Deals: THE GRY

Gross Rental Yield = (Yearly Rental Income / Purchase Price) x 100%

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How I evaluate Rental Property Deals: THE GRY

How I evaluate Rental Property Deals: THE GRY

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How I evaluate Rental Property Deals: THE GRM