Davao calculator

Rental Yield Calculator — Davao

Tells you whether a Davao condo or house would actually pay you back as a rental. Enter purchase price and expected monthly rent for gross yield, net yield (after vacancy + dues + tax), and a market benchmark.

Data as of May 2026 · Davao residential market benchmarks (tool-params.json, dated + sourced)

0%4% (typical)8%

Added to the cash outlay so yield is computed on the all-in cost basis, not the headline price. Set to 0% to see the price-only (listing) yield.

0%8% (Davao prime)50%

Davao prime-area vacancy runs ~8% (2026-05) — lower than Metro Manila. Outer condos sit higher.

Methodology, formula + sources

How this is calculated

Whether a Davao condo or house actually pays back as a rental. Every yield is computed on the all-in cash outlay — price plus buyer closing costs — not the headline price, so a listing's advertised yield is recovered only by setting closing to 0%. Gross is the quick headline; net subtracts vacancy and the real annual costs; cap rate here is the unleveraged net yield.

Formula

costBasis = price × (1 + closing%)
grossYield = (rent×12 ÷ costBasis) × 100
effectiveRent = rent×12 × (1 − vacancy)
expenses = dues×12 + propertyTax + maint×12 + mgmt×12
netYield = (effectiveRent − expenses) ÷ costBasis × 100   (= capRate)

Constants + data sources (each dated)

Value used Source As of
Vacancy (Davao prime, typical): 8% (below Metro Manila) Davao property market — Davao City residential market 2025–2026: net yield, vacancy, appreciation, rent growth, transaction costs 2026-05
Benchmark yields: gross ~6.5% · net ~4.8% Bamboo Routes Davao 2026-05
Condo dues: ₱35–90/sqm/month Davao property market dataset 2026-05
RPT (effective): 1–2% of assessed value Davao City Treasurer RPT schedule 2026-05
Management fee: 8–12% of rent Davao property market dataset 2026-05
Buyer closing cost: 4% of price (statutory DST/transfer/registration) Statutory (DST / transfer / registration) 2026-05

Worked example (reproduce this by hand)

₱5,000,000 price, ₱25,000/mo rent, 8% vacancy, 4% buyer closing, no advanced expenses entered.

  1. costBasis = 5,000,000 × 1.04 = ₱5,200,000
  2. gross = 300,000 ÷ 5,200,000 = 5.77%
  3. effectiveRent = 300,000 × 0.92 = ₱276,000
  4. net = 276,000 ÷ 5,200,000 = 5.31% → cash-flow positive

→ Gross 5.77% · net 5.31% on a ₱5.2M basis (at 0% closing the basis is ₱5.0M and gross is exactly 6.00%)

Assumptions

  • Unleveraged — cap-rate-style view; a mortgage changes cash-on-cash materially.
  • Closing slider at 0% recovers the listing-only headline yield.
  • Property tax accepts either % of price or an absolute ₱ figure (mode toggle).

Known limits — what this does not model

  • Mortgage financing / cash-on-cash leverage.
  • Capital gains tax on eventual sale.
  • Condo special assessments and Davao-specific calamity insurance.
Last verified 2026-05-19 · Next review Davao market quarterly

How yield works in the Davao market

The Davao rental market has lower vacancy (~10–12%) than Metro Manila but rents per square metre run lower too. Net yields of 4–5% on well-located condos are normal; standalone houses in subdivisions yield less because turnover is slower and management overhead is higher.

Three cost drags eat into the gross-net gap most often:

  • Condo association dues: ₱35–90 per square metre per month at Davao buildings, with newer Ayala/DMCI towers at the higher end.
  • Annual real-property tax: 1–2% of assessed value, billed by the City Treasurer.
  • Vacancy gaps: 1–2 months a year is typical between tenants; 3+ months suggests the asking rent is above market.

Frequently asked questions

What is a good rental yield in Davao?
Net yields of 4–5% are realistic for Davao condos after deducting vacancy (~10–15%), condo dues, and property tax. Gross yields of 5–7% are common for studios and 1BRs near the Matina IT corridor and Lanang business parks. Above 6% net is exceptional and worth re-checking the rent assumption.
How is gross yield different from net yield?
Gross yield is annual rent divided by purchase price — a quick headline number. Net yield subtracts real-world expenses: vacancy losses, condo dues (₱35–90/sqm/month in Davao), annual property tax (1–2% of assessed value), maintenance, and any management fees. Net is what you actually keep.
Why does location matter for yield?
Studios in Bajada or near BPO clusters (Matina, Lanang) get rented faster, so vacancy is lower and effective yield is higher. Outer-area condos may show similar gross yields on paper but suffer longer vacancy gaps. The benchmark figure in this tool reflects observed averages, not aspirational pricing.
Should I include closing costs in property price?
The tool does this for you. Yield is computed on the all-in cost basis — price plus buyer closing costs (DST + transfer tax + registration, ~4% default, adjustable). Set the closing slider to 0% if you want the price-only listing yield instead.
What if the property is cash-flow negative?
The tool flags it explicitly. If vacancy + dues + RPT + maintenance + management exceed effective rent, net income goes red and you see the monthly out-of-pocket figure. A negative-cash-flow rental only works if you are betting entirely on appreciation.

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These estimates are for budgeting. Confirm current rates and legal terms with your provider or a Davao-based lawyer for binding decisions.