What counts as a good rental yield in Australia?

Gross yield = (annual rent ÷ property price) × 100. Sydney inner ring at $1.5M with $40K annual rent = 2.7% gross. Brisbane outer at $700K with $32K rent = 4.6%. Adelaide regional at $400K with $24K rent = 6.0%. The percentage moves with three drivers: rent demand-supply balance, price level (lower prices typically = higher yield), + risk premium (regional + thin markets price in higher yield as compensation for liquidity risk).

Net yield = gross minus 7-9% management, ~1-2%/yr maintenance reserve, vacancy reserve (~vacancy rate × 52 weeks), insurance, council rates, water, strata if applicable, land tax if above state threshold. A 4.6% gross typically lands at 2.8-3.4% net. Always compare net yields, not gross, gross is the headline + glossy-marketing number.

Goal-driven benchmark: if your strategy is cashflow-positive holding (5+ properties, retire on rent), target 5-7% gross. If your strategy is capital growth (1-3 metro IPs, with a tax-advantaged structure), accept 3-4% gross + bank on long-term price appreciation. Most successful 5-property portfolios mix: 1-2 capital-city growth + 3-4 regional/mid-tier yield.

Reading a yield in context: a 7% gross yield in a thin-market regional with structural decline is worse than a 3.5% gross yield in a high-growth capital, the headline number doesn't capture the full risk-adjusted return. Use the rental-yield calculator at /tools/rental-yield to factor in net + post-tax + 10-year capital growth assumptions.