Property ROI Calculator (Return on Cash Invested)
Measure annual profit against the cash you actually put into the deal.
Total cash invested
£63,000
Mortgage borrowed
£150,000
Annual mortgage interest
£7,800
Annual pre-tax profit
£2,200
Return on cash invested
3.49%
Payback on cash invested
28.6 years
What this calculator tells you
Return on investment answers the question yield cannot: what is my own money earning? Because a mortgage lets you control a large asset with a small deposit, a property with a modest 5% yield can produce a double-digit return on the cash you personally committed — or a negative one, if rates outrun the rent.
How it works
- 1Add up every pound leaving your pocket: deposit, stamp duty, legal and survey fees, broker fee and refurbishment.
- 2Work out annual pre-tax profit: rent, minus running costs, minus mortgage interest.
- 3Divide profit by cash invested and multiply by 100.
- 4Payback period is simply cash invested ÷ annual profit — how long before the deal has returned your stake.
Worked example
£200,000 purchase, 25% deposit, £1,100 rent
- Deposit £50,000 + fees £2,500 + SDLT £7,500 + refurb £3,000 = £63,000 cash in.
- Borrowing £150,000 at 5.2% interest-only costs £7,800 a year.
- Rent £13,200 − running costs £3,200 − interest £7,800 = £2,200 profit.
- £2,200 ÷ £63,000 × 100 = 3.49% ROI.
A 3.5% cash return is thin — the deal depends on capital growth or a rent rise. Compare it honestly against a savings account before proceeding.
Frequently asked questions
What is a good ROI on a UK buy-to-let?
Investors typically target 8% or more on cash invested. In the current interest-rate environment many leveraged single lets come in between 2% and 6%, which is why refurbishment-led and multi-let strategies have become more popular.
Does ROI include capital growth?
Not in this calculator. It measures income return only. Capital growth is real but unrealised and unpredictable, so it is safer to treat it as upside rather than as part of the return you are relying on.
Related content
These calculators give general estimates for UK private landlords and letting agents, not legal, tax or financial advice. Figures depend on your circumstances and on the rules in your part of the UK — check the detail or take advice before acting.