Rental Property ROI Calculator
Size up a rental before you buy. Enter the purchase price, financing, rent, vacancy and operating expenses to see the cap rate, cash-on-cash return, monthly cash flow and net operating income.
How to use the rental property ROI calculator
- Enter the purchase price, down payment, mortgage rate and term.
- Add the monthly rent, an expected vacancy rate and your monthly operating expenses.
- Review the cap rate, cash-on-cash return, monthly cash flow, NOI and total cash invested.
Examples
200k property, 20% down, 6% / 30y, 2,000 rent
Price 200,000, 20% down, rate 6%, term 30y, rent 2,000, vacancy 5%, expenses 600, closing 6,000
Mortgage about 959.28/mo, NOI 15,600, cap rate about 7.8%, monthly cash flow about 340.72
Frequently asked questions
What is the difference between cap rate and cash-on-cash return?
Cap rate is unlevered: it divides net operating income by the purchase price and ignores your mortgage, so it measures the property itself. Cash-on-cash return is levered: it divides your annual cash flow (after the mortgage) by the actual cash you invested, so it measures the return on your money.
How is net operating income (NOI) calculated?
NOI is effective rent minus operating expenses, annualized. Effective rent is your gross rent reduced by the vacancy allowance. Operating expenses include taxes, insurance, maintenance and management, but they exclude mortgage principal and interest, which is why NOI is the same whether you pay cash or finance.
What expenses should I include?
Include recurring operating costs: property taxes, insurance, repairs and maintenance, property management and any HOA dues or utilities you cover. Do not include the mortgage payment in operating expenses; the calculator handles financing separately so your NOI and cap rate stay correct.
What is a good cap rate or cash-on-cash return?
It depends on the market and risk. Many investors look for a cap rate in the mid-single digits or higher and a cash-on-cash return that beats safer alternatives, but a low-risk area can justify a lower cap rate. Use the numbers to compare deals rather than chase a single target.
How is the monthly mortgage figured?
The loan amount is the price minus your down payment, amortized at the rate and term you enter using the standard mortgage formula. An all-cash purchase (100% down) has no loan and no mortgage payment.
Is my data sent anywhere?
No. The calculation runs entirely in your browser. Nothing you type is uploaded, stored or shared, so you can model private deals freely.
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