NZ Cap Rate Calculator
Work both ways: punch in price + rent to get cap rate, or enter a target cap rate + rent to see what you should pay. Suburb-aware opex defaults included.
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How to read these numbers
NZ residential investors mix three terms — gross yield, cap rate, and cash-on-cash — and the difference matters when you're comparing deals.
Gross yield
Annual rent divided by purchase price. The lazy default. Useful as a screening number but ignores rates, insurance, vacancy, and maintenance — so a 6% gross yield in a high-rates suburb can be the same as a 4.5% gross yield in a low-rates one.
Net cap rate (NOI ÷ price)
Net Operating Income (rent after vacancy, opex, management) divided by price. This is the number commercial investors live by, and it's the right comparison number for residential too. NZ residential typically sits between 3.5% and 5%; anything above 5% is genuinely strong.
Cash-on-cash return
NOI minus annual mortgage interest, divided by your cash deposit. Tells you what your equity is actually earning each year. Highly leveraged deals can show high cash-on-cash because the denominator is small — pair it with cap rate to avoid being misled.
Why suburb-aware defaults matter
A 3-bed standalone in Wellington pays roughly $700/yr more in council rates than the same dwelling in Hamilton. Insurance premiums are similar but vary by region. We've coded TLA-level defaults from 2025/26 council schedules so the moment you pick a TLA, your numbers stop assuming a national average that's wrong for both.
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