Rental Yield Calculator Nigeria — Property Investment ROI

A gross rental yield of 6–10% is considered good in Nigeria. Prime areas like Victoria Island and Ikoyi typically yield 4–7% (high prices, moderate rents), while emerging areas like Lekki Phase 2 or Gbagada yield 8–12%. Commercial properties typically yield higher than residential. Compare your yield against a fixed-term savings account (currently 10–18% in Nigeria) to assess whether the investment is worthwhile.

Gross yield = (Annual Rent ÷ Property Value) × 100. Net yield deducts expenses like maintenance, property tax (land use charge), agency/management fees, and vacancy allowance. Net yield is the more realistic figure. For a property yielding 9% gross with ₦150k in annual expenses on a ₦15M property, the net yield is about 8%.

ROI depends on whether you paid cash or used a mortgage. For a cash purchase: ROI = Net Annual Income ÷ Total Investment × 100. For a mortgaged property, your actual cash-on-cash return is calculated on your cash down payment only. This calculator shows both cash and overall ROI.

Budget for: property management fee (10% of rent if using an agent), maintenance and repairs (1–2% of property value per year), Land Use Charge / property tax (₦50,000–₦500,000+ per year), insurance, renovation between tenants, legal fees for new tenancy agreements, and vacancy periods (typically 1–2 months per year).

At a 7% net yield, payback period is about 14 years. At 10% net yield, it is 10 years. Many Nigerian property investors earn returns through capital appreciation (property value growth) in addition to rental income. Properties in fast-developing areas can double in value within 5–8 years, significantly improving total ROI.