Buy to Let Help

How the Calculator Works

Understand what inputs the calculator uses, what outputs it produces, and the calculations behind the results.

What You Enter

The calculator accepts the following inputs. All currency values are in GBP. Default values are provided to help you get started quickly.

Investor & Location
  • Buyer type (Individual or Limited Company)
  • Property region (England & NI, Scotland, or Wales)
  • Additional property status (for transaction tax)
Purchase & Financing
  • Purchase price
  • Loan-to-value ratio (70%, 75%, or 80%)
  • Mortgage type (Interest-only or Repayment)
  • Mortgage interest rate
  • Mortgage term (for repayment mortgages)
Up-front Costs
  • Legal fees
  • Repair/refurbishment costs
  • Survey fees
  • Other transaction costs
Rental Income
  • Expected monthly rent
  • Letting agent fee percentage
Ongoing Expenses
  • Maintenance (% of price or fixed monthly)
  • Insurance
  • Service charge
  • Ground rent
  • Other monthly costs

What You Get

Based on your inputs, the calculator produces the following outputs. Results update automatically as you change any input value.

Monthly Figures
  • Monthly mortgage payment
  • Monthly running expenses
  • Monthly profit (rent minus all costs)
Annual Summary
  • Annual rental income
  • Annual profit
Investment Totals
  • Deposit amount
  • Mortgage amount
  • Transaction tax (Stamp Duty/LBTT/LTT)
  • Total cash invested
Yields & Returns
  • Gross yield (annual rent / purchase price)
  • Net yield (net income / purchase price)
  • ROI (annual profit / total cash invested)

How Calculations Work

Here are the key formulas used to calculate your results. All values are rounded appropriately for display.

Deposit

The cash contribution based on your chosen loan-to-value ratio.

Purchase Price × (1 - LTV%)

Mortgage Amount

The total amount borrowed from the lender.

Purchase Price - Deposit

Interest-Only Payment

Monthly payment covering only the interest on the loan.

Mortgage Amount × (Rate% / 12)

Repayment Mortgage

Monthly payment covering both interest and principal, calculated to fully repay the loan over the term.

Standard amortisation formula

Gross Yield

Return based on rental income before any costs are deducted.

(Annual Rent / Purchase Price) × 100

Net Yield

Return after accounting for mortgage interest and running costs.

(Annual Rent - Interest - Expenses) / Purchase Price × 100

ROI

Return on the actual cash you put into the investment.

(Annual Profit / Total Cash Invested) × 100

Assumptions & Limitations

Assumptions Used
  • Transaction tax is calculated using current UK rates for SDLT (England & NI), LBTT (Scotland), or LTT (Wales)
  • Limited company purchases are always treated as additional property purchases
  • If no maintenance figure is entered, 1% of the purchase price per year is assumed
  • Void periods (empty property) are not included in the calculations
  • Capital appreciation and depreciation are not considered
  • Tax on rental income is not calculated
Not Included
  • Income tax calculations
  • Corporation tax for limited companies
  • Capital gains projections
  • Void periods or tenant turnover
  • Property value appreciation
  • Mortgage arrangement fees
  • Rental increase projections

Ready to Calculate?

Now that you understand how it works, try the calculator with your own property details.

Open Calculator