REIT Dividend Yield Calculator
Calculate REIT dividend yield, FFO multiple, and total return.
Compare equity REITs against your target yield with quarterly distribution analysis.
REIT Dividend Yield
A REIT (Real Estate Investment Trust) must legally distribute 90% of taxable income as dividends to maintain tax-exempt status at the trust level. This makes them income-focused investments with naturally high yields.
The basic formula: Dividend Yield % = (Annual dividends per share / Share price) × 100
For quarterly REITs: Annual dividends = Quarterly dividend × 4
Typical REIT yield ranges (2026):
| REIT Type | Typical Yield |
|---|---|
| Equity (apartments, retail, office) | 3-6% |
| Industrial / data center | 2-4% (lower yield, higher growth) |
| Mortgage REIT (mREIT) | 8-15% (high but volatile) |
| Healthcare / senior housing | 4-7% |
| Specialty (cell tower, prison, casino) | 3-5% |
| Self-storage | 3-5% |
| Net-lease (single-tenant) | 5-7% |
Compare yield to:
- 10-year Treasury yield (the “risk-free” baseline)
- S&P 500 dividend yield (~1.5-2%)
- High-yield savings account (HYSA, ~4-5%)
- Investment-grade bonds (~5-6%)
If a REIT yields less than the 10-year Treasury, you’re paying for growth potential. If it yields 3% above, you’re paid for the higher risk vs. Treasuries.
FFO (Funds From Operations) — the better metric: REITs use depreciation aggressively, so reported earnings (EPS) understate real cash flow. FFO (or AFFO) is the true earnings metric: Price/FFO ratio is REIT equivalent of P/E ratio
| P/FFO | Valuation |
|---|---|
| Under 12 | Cheap (or in trouble — investigate) |
| 12-18 | Fair value |
| 18-25 | Premium (high growth or quality REITs) |
| 25+ | Expensive (data centers, cell towers historically) |
Yield trap warnings: A very high yield (above 10%) often signals:
- Dividend at risk of being cut (payout ratio > 100% of FFO)
- Sector in distress (e.g., office REITs post-pandemic)
- Mortgage REITs leveraged into rate-rising environment
- Capital structure stress
Always check the FFO payout ratio — if FFO doesn’t cover the dividend, the dividend will be cut.
Tax considerations:
- REIT dividends are mostly ordinary income — taxed at marginal rate
- Hold REITs in tax-advantaged accounts (IRA, 401k, Roth) when possible
- Some REIT dividends are “qualified” — verify with annual 1099
- 199A deduction (20%) applies to REIT dividends in non-qualified accounts (2017 TCJA)
REIT total return = Yield + FFO growth + multiple expansion The yield is just one piece. A 4% yielder growing FFO at 5% per year delivers ~9% total return without needing multiple expansion.