How Rental Yield Is Calculated
Rental yield = (Annual rent / Property purchase price) × 100
A ₹80 lakh apartment generating ₹25,000 per month in rent delivers a gross yield of 3.75%. After deducting property tax, maintenance, and vacancy, the net yield is typically 2.8–3.2%.
City-by-City Breakdown
Chennai (Gross Yield: 2.8–3.9%)
- Sholinganallur: 3.5–3.9% (tech worker demand keeps vacancy low)
- Thoraipakkam: 3.2–3.6%
- Perumbakkam: 3.4–3.8% (emerging, higher yield on lower price base)
- ECR: 2.5–3.0% (lower yield, higher appreciation)
Hyderabad (Gross Yield: 3.0–4.1%)
- Gachibowli: 3.5–4.1% (best yield in premium market)
- HITEC City: 3.2–3.8%
- Kokapet: 2.8–3.2% (appreciation-first market)
- Shamshabad: 3.6–4.0% (airport proximity drives short-term rentals)
Bengaluru (Gross Yield: 2.4–3.5%)
- Whitefield: 3.0–3.5%
- Sarjapur Road: 2.8–3.2%
- Koramangala: 2.4–2.8% (premium locality, compressed yield)
- Hebbal: 3.2–3.6% (near airport, good demand)
Coimbatore (Gross Yield: 3.6–4.4%)
- Saravanampatti: 3.8–4.4% (best in class, IT worker demand)
- Peelamedu: 3.6–4.0%
- RS Puram: 3.2–3.6%
Key Factors That Affect Your Actual Yield
- Furnishing level: Fully furnished apartments command 30–40% more rent but cost ₹8–15 lakh to furnish
- Vacancy rate: Target markets with <4% annual vacancy; Gachibowli and Sholinganallur meet this standard
- Tenant quality: IT professionals on 2-year leases with company-backed rental allowances are the most reliable tenants
- Property age: New properties have fewer maintenance surprises and attract better tenants
The Appreciation vs Yield Trade-off
High-appreciation markets like Kokapet and Koramangala offer lower yields but stronger capital gains. High-yield markets like Saravanampatti offer better income but more modest appreciation. Neither is universally superior — the right choice depends on your financial goals and investment horizon.
