Rental Yield in Singapore: How to Calculate It and What Is Good (2026)
How to calculate gross and net rental yield on a Singapore property, which costs to include, what counts as a good yield in 2026, and the mistakes to avoid.
Rental yield is the rent a property earns in a year as a percentage of its price. Gross yield uses the rent alone; net yield subtracts the costs of owning and letting the property first. In Singapore in 2026, private homes gross about 3% on average and net closer to 2% to 2.5% once property tax, maintenance fees and vacancy are counted. Whether that is “good” depends on what your money could earn elsewhere and on what you pay to borrow.
At a glance
- Gross yield = annual rent ÷ price. Net yield = (annual rent − operating costs) ÷ price.
- Leave the mortgage out of net yield. Financing belongs in cash-on-cash return and IRR, not in the yield.
- In our example, a S$1.2m condo renting at S$3,800 a month grosses 3.8% and nets 2.5%.
- Rented-out homes pay property tax at 12% to 36% of annual value, much more than owner-occupiers pay.
- Use today’s achievable rent, not a projected or “guaranteed” one, and always allow for vacancy.
Gross yield vs net yield
Gross rental yield is the number on most listings and in most sales pitches:
Gross yield = annual rent ÷ purchase price × 100
A S$1.2m condo that rents for S$3,800 a month earns S$45,600 a year, so its gross yield is 3.8%.
Net rental yield (property professionals call it the capitalisation or cap rate) takes off what it costs to own and let the unit:
Net yield = (annual rent − vacancy − operating costs) ÷ purchase price × 100
Net yield tells you how efficiently the property itself turns price into income, so it is the right number for comparing one unit with another. Do not take off mortgage interest or principal. Two buyers of the same flat with different loans own the same property; the loan changes their return on cash, not the property’s yield. That is what cash-on-cash return and IRR are for.
Which costs to deduct
For a hypothetical S$1.2m condo let at S$3,800 a month:
| Item | Per year | Notes |
|---|---|---|
| Gross rent | S$45,600 | S$3,800 × 12 |
| Vacancy allowance | −S$1,900 | Half a month a year, or one month between two-year leases |
| Agent’s commission | −S$1,900 | Assumes one month’s rent per two-year lease |
| Maintenance fees and sinking fund | −S$4,200 | Assumes S$350 a month |
| Property tax (non-owner-occupied) | −S$6,240 | On an annual value of S$43,200 |
| Repairs, insurance, replacements | −S$1,500 | Aircon servicing, appliances, touch-ups |
| Net operating income | S$29,860 | |
| Net yield | 2.5% | S$29,860 ÷ S$1.2m |
S$ per year
Source: Propwise worked example; property tax rates from IRAS (October 2026). Costs are the guide's assumptions, not quotes.
Property tax is the cost most first-time landlords underestimate. Once you rent the unit out, the owner-occupier rates no longer apply. IRAS charges non-owner-occupied homes 12% on the first S$30,000 of annual value, 20% on the next S$15,000, 28% on the next S$15,000 and 36% above S$60,000. Annual value is IRAS’s estimate of the yearly rent, excluding furniture, furnishings and maintenance fees. Here, 12% × S$30,000 + 20% × S$13,200 = S$6,240, which is 14% of the gross rent.
Two refinements:
- Yield on total cost. Add the S$32,600 Buyer’s Stamp Duty, legal fees and furnishing to the price, and the net yield falls to about 2.4%. If you pay 20% Additional Buyer’s Stamp Duty on a second home, the cost base becomes about S$1.48m and the net yield on cost is about 2.0%.
- Income tax. Rental profit is added to your other income and taxed at your marginal rate. You can deduct actual expenses such as mortgage interest, property tax, maintenance and agent fees, or claim a flat 15% of gross rent plus mortgage interest. Yields are normally quoted before tax, but your actual return is after it.
What is a good rental yield in Singapore in 2026?
Start with what the market pays. Asking-rent data compiled by Global Property Guide for the first half of 2026 puts the average gross yield on Singapore apartments at about 3.1%. It ranges from about 2.7% around East Coast and Marine Parade to about 3.3% in Punggol, Sengkang and Hougang. Suburban units tend to yield a little more than prime ones, because rents vary less across the island than prices do.
So our example’s 3.8% gross yield is better than average. At an average 3.1% (S$3,100 a month on the same S$1.2m unit), the same costs leave a net yield of about 2.0%.
| Yardstick | Rate |
|---|---|
| Net yield on the example condo | about 2.5% |
| Bank floating-rate packages | about 1.5% to 1.8% |
| Bank fixed-rate packages | about 2.0% to 2.2% |
| CPF Ordinary Account | 2.5% a year |
| November 2026 Singapore Savings Bond, 10-year average | 2.45% a year |
| Rate banks use to test your loan (TDSR) | 4% |
Source: CPF Board, interest rates (October 2026); The Business Times (2 October 2026); MAS, Singapore Savings Bonds.
A yield is “good” only relative to something else. Three useful benchmarks:
- Your borrowing cost. With 3-month compounded SORA around 1.24% on 14 Oct 2026, bank packages were around 1.5% to 1.8% floating and 2.0% to 2.2% fixed (The Business Times, 2 Oct 2026). A 2.5% net yield is above those rates, but not by much. That gap was negative in 2023, when rates were far higher. Remember that banks still assess your loan at a 4% stress-test rate for your Total Debt Servicing Ratio.
- Risk-free alternatives. CPF Ordinary Account savings earn 2.5% a year, and the November 2026 Singapore Savings Bond averages 2.45% a year over 10 years, with no tenants, repairs or vacancy. A property’s net yield plus realistic price growth should clear that by a margin that pays you for the risk and the work.
- Lease decay. A 99-year leasehold with 60 years left must earn more than a freehold unit, because part of the rent is really a return of your capital as the lease runs down. See our guide to valuing leasehold property.
Rental yield on an HDB flat
HDB flats often show higher gross yields than condos, because rents are high relative to prices. The median 4-room resale price in August 2026 was about S$628,000, and the median 4-room rent in the second quarter of 2026 was about S$3,400 a month. That is a gross yield of about 6.5%.
The catch is that most owners cannot simply buy a flat to rent out. You must live in it through the minimum occupation period, usually five years. Owners of Plus and Prime flats can never rent out the whole flat, only rooms. Treat the HDB yield as a way to judge what renting out your current flat is worth, not as an investment option on its own.
Seven mistakes that inflate yields
- Quoting gross as if it were net. Ask “net of what?” every time.
- Using a future rent. For an uncompleted project, there is no rent for three to four years and no proven rent afterwards. Use today’s rent for a comparable completed unit.
- Counting on short-term rents. Private homes must be let for at least three consecutive months, and HDB flats for at least six months. Nightly or weekly Airbnb-style rates are not a legal basis for a yield.
- Trusting a “guaranteed” yield. A rental guarantee is often paid for through a higher purchase price, and it ends when the guarantee period does.
- Ignoring vacancy. The private-home vacancy rate was 6.4% in Q2 2026: 8.3% in the core central region, 6.1% in the city fringe and 5.6% in the suburbs.
- Subtracting interest from the yield. “3% net yield minus 1.5% interest equals 1.5% profit” mixes two different measures and ignores principal repayment, tax and the cash you put in.
- Mixing up price and value. A unit that is “cheap” at S$1,300 psf because neighbours sold at S$1,400 psf is not cheap if the rent it can earn does not support either price. Yield is one way to test whether a price makes sense.
How yield and price move together
For a given rent, yield moves the opposite way to price: if prices rise faster than rents, yields fall. In the second quarter of 2026, URA’s private rental index rose 0.7% while the price index rose 0.5%. In Q3 2026, prices changed by a further +1.4% in URA’s flash estimate. When prices run well ahead of rents for years, buyers are paying for expected price growth, not income. That is a warning sign, not a guarantee of a fall, but it means more of your return depends on someone paying more than you did.
- Prices (URA price index)
- Rents (URA rental index)
Latest: Prices 219.4 (Q2 2026); Rents 162.5 (Q2 2026).
Table view
| Period | Prices (URA price index) | Rents (URA rental index) |
|---|---|---|
| Q2 2026 | 219.4 | 162.5 |
| Q1 2026 | 218.3 | 161.4 |
| Q4 2025 | 216.4 | 160.9 |
| Q3 2025 | 215.1 | 161.7 |
| Q2 2025 | 213.2 | 159.8 |
| Q1 2025 | 211.1 | 158.5 |
| Q4 2024 | 209.4 | 157.9 |
| Q3 2024 | 204.7 | 157.9 |
| Q2 2024 | 206.1 | 156.6 |
| Q1 2024 | 204.3 | 157.9 |
| Q4 2023 | 201.5 | 161.0 |
| Q3 2023 | 196.0 | 164.5 |
| Q2 2023 | 194.4 | 163.2 |
| Q1 2023 | 194.8 | 158.8 |
| Q4 2022 | 188.6 | 148.1 |
| Q3 2022 | 187.8 | 137.9 |
| Q2 2022 | 180.9 | 127.0 |
| Q1 2022 | 174.8 | 119.0 |
| Q4 2021 | 173.6 | 114.2 |
| Q3 2021 | 165.3 | 111.3 |
| Q2 2021 | 163.5 | 109.3 |
| Q1 2021 | 162.2 | 106.2 |
| Q4 2020 | 157.0 | 103.9 |
| Q3 2020 | 153.8 | 103.8 |
| Q2 2020 | 152.6 | 104.3 |
| Q1 2020 | 152.1 | 105.6 |
| Q4 2019 | 153.6 | 104.5 |
| Q3 2019 | 152.8 | 105.6 |
| Q2 2019 | 150.8 | 105.5 |
| Q1 2019 | 148.6 | 104.1 |
| Q4 2018 | 149.6 | 103.1 |
| Q3 2018 | 149.7 | 104.1 |
| Q2 2018 | 149.0 | 103.8 |
| Q1 2018 | 144.1 | 102.8 |
| Q4 2017 | 138.7 | 102.5 |
| Q3 2017 | 137.6 | 103.4 |
| Q2 2017 | 136.6 | 103.4 |
| Q1 2017 | 136.7 | 103.6 |
| Q4 2016 | 137.2 | 104.5 |
| Q3 2016 | 137.9 | 105.6 |
| Q2 2016 | 140.0 | 106.9 |
| Q1 2016 | 140.6 | 107.5 |
| Q4 2015 | 141.6 | 108.9 |
| Q3 2015 | 142.3 | 110.3 |
| Q2 2015 | 144.2 | 111.0 |
| Q1 2015 | 145.5 | 112.2 |
| Q4 2014 | 147.0 | 114.1 |
| Q3 2014 | 148.6 | 115.2 |
| Q2 2014 | 149.7 | 116.1 |
| Q1 2014 | 151.3 | 116.8 |
| Q4 2013 | 153.2 | 117.6 |
| Q3 2013 | 154.6 | 118.2 |
| Q2 2013 | 154.0 | 117.9 |
| Q1 2013 | 152.4 | 117.6 |
| Q4 2012 | 151.5 | 116.6 |
| Q3 2012 | 148.8 | 115.9 |
| Q2 2012 | 147.9 | 114.8 |
| Q1 2012 | 147.2 | 114.5 |
| Q4 2011 | 147.4 | 114.2 |
| Q3 2011 | 147.0 | 113.7 |
| Q2 2011 | 145.1 | 112.8 |
| Q1 2011 | 142.3 | 111.4 |
| Q4 2010 | 139.2 | 110.0 |
| Q3 2010 | 135.5 | 107.2 |
| Q2 2010 | 131.7 | 103.5 |
| Q1 2010 | 125.1 | 97.7 |
| Q4 2009 | 118.4 | 93.3 |
| Q3 2009 | 110.3 | 92.8 |
| Q2 2009 | 95.3 | 94.8 |
| Q1 2009 | 100.0 | 100.0 |
| Q4 2008 | 116.4 | 109.3 |
| Q3 2008 | 123.9 | 115.5 |
| Q2 2008 | 126.9 | 116.5 |
| Q1 2008 | 126.7 | 113.6 |
| Q4 2007 | 122.1 | 107.2 |
| Q3 2007 | 114.4 | 100.4 |
| Q2 2007 | 105.6 | 90.1 |
| Q1 2007 | 97.6 | 81.6 |
| Q4 2006 | 93.1 | 75.9 |
| Q3 2006 | 89.6 | 72.1 |
| Q2 2006 | 87.3 | 68.7 |
| Q1 2006 | 85.8 | 67.2 |
| Q4 2005 | 84.5 | 66.5 |
| Q3 2005 | 83.3 | 66.1 |
| Q2 2005 | 82.3 | 65.6 |
| Q1 2005 | 81.9 | 65.2 |
| Q4 2004 | 81.3 | 64.6 |
| Q3 2004 | 80.7 | 64.2 |
| Q2 2004 | 80.4 | 64.0 |
| Q1 2004 | 80.3 | 64.0 |
If you plan to let your unit, our landlord’s guide covers tenant screening and the tenancy agreement.
Bottom line
Work out the net yield on a unit before you look at the asking price per square foot. Deduct vacancy, agent fees, maintenance, the higher non-owner-occupier property tax and repairs, and use the rent a comparable unit actually achieves today. A net yield of about 2.5% on a Singapore condo is normal in 2026. It beats today’s loan rates but leaves little room if rates rise, so test your numbers with our mortgage calculator at a higher rate too.
