Rental property calculator
Analyze a rental property in one pass. Enter the purchase, the financing, the rent and the running costs, and see monthly cash flow, net operating income, cap rate, cash on cash return and annual ROI side by side.
Your results
EstimateMonthly cash flow: $154.00
- Annual cash flow
- $1,848.00
- Net operating income
- $19,140.00
- Cap rate
- 6.72%
- Cash on cash return
- 2.57%
- Annual ROI
- 17.98%
- Total cash invested
- $72,000.00
Results are estimates for planning only. They are not legal, tax or investment advice, and they apply no state or local rules. Check your lease, your local laws and a qualified professional before you rely on a number.
How the rental property calculator works
Monthly cash flow = rent after vacancy - operating expenses - mortgage payment
Rent after vacancy is the monthly rent times 12, minus the vacancy rate, divided back into months. Vacancy comes off the rent once, and every result below uses the same figure.
Monthly cash flow is what is left each month after operating expenses and the mortgage payment. Annual cash flow is that amount times 12. It is the money the property puts in your pocket before income tax.
Net operating income (NOI) is a year of rent after vacancy minus a year of operating expenses. It leaves out the mortgage, so it describes the property itself, whatever the financing.
Cap rate is NOI divided by the purchase price. It lets you compare properties as if each were bought with cash.
Cash on cash return is annual cash flow divided by total cash invested: the down payment, closing costs and upfront repairs. It shows what your own money earns once the loan is in the picture.
Annual ROI adds the equity you build to the cash flow: loan principal paid down in year one plus appreciation on the purchase price, divided by total cash invested. Appreciation is a forecast, so try a few rates.
Worked example
You buy a three-bedroom house for $285,000 with $57,000 down (20%), $8,500 in closing costs and $6,500 of repairs before the first tenant moves in. It rents for $2,500 a month, you plan for 5% vacancy, and taxes, insurance, repairs and management come to $780 a month. The $228,000 loan at 6.5% over 30 years costs $1,441 a month and pays down about $2,550 of principal in year one. You expect 3% appreciation.
- Total cash invested: $57,000 + $8,500 + $6,500 = $72,000.
- Rent after vacancy: $2,500 x 12 x (1 - 5%) = $28,500 a year, or $2,375 a month.
- Monthly cash flow: $2,375 - $780 - $1,441 = $154. Annual cash flow: $154 x 12 = $1,848.
- NOI: $28,500 - ($780 x 12) = $28,500 - $9,360 = $19,140.
- Cap rate: $19,140 / $285,000 = 6.72%.
- Cash on cash return: $1,848 / $72,000 = 2.57%.
- Annual ROI: ($1,848 + $2,550 + $285,000 x 3%) / $72,000 = ($1,848 + $2,550 + $8,550) / $72,000 = $12,948 / $72,000 = 17.98%.
Monthly cash flow is $154.00, with a 6.72% cap rate, a 2.57% cash on cash return and a 17.98% annual ROI. Most of this property's first-year return comes from loan paydown and appreciation, which you collect when you sell or refinance.
Frequently asked questions
What does a rental property calculator measure?
It turns a property's price, financing, rent and expenses into the numbers investors compare deals on: monthly and annual cash flow, net operating income, cap rate, cash on cash return and ROI. This one shows them together, so a change to one input updates every result.
What is the difference between cap rate and cash on cash return?
Cap rate divides NOI by the purchase price and ignores the loan, so it compares properties. Cash on cash return divides cash flow after the mortgage by the cash you put in, so it measures your own money's return with the financing you chose.
What should I include in operating expenses?
Property taxes, insurance, repairs and maintenance, property management, utilities you pay, HOA dues and a reserve for larger replacements. Leave out the mortgage payment, depreciation and income tax; the calculator handles the mortgage on its own line.
How do I analyze a cash purchase?
Enter the full purchase price as the down payment and 0 for the mortgage payment and principal paydown. Cash flow then equals NOI divided by 12, and cash on cash return lands close to the cap rate, apart from closing costs and repairs.
Does the calculator include taxes and selling costs?
No. Results are before income tax, depreciation and the costs of selling. Use them to compare deals and plan, and check the final numbers with a qualified professional.
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