function calculateRentalROI() {
// Get Inputs
var price = parseFloat(document.getElementById('propPrice').value) || 0;
var downPct = parseFloat(document.getElementById('downPay').value) || 0;
var rate = parseFloat(document.getElementById('intRate').value) || 0;
var term = parseFloat(document.getElementById('loanTerm').value) || 0;
var rent = parseFloat(document.getElementById('moRent').value) || 0;
var tax = parseFloat(document.getElementById('propTax').value) || 0;
var ins = parseFloat(document.getElementById('homeIns').value) || 0;
var hoa = parseFloat(document.getElementById('hoaFee').value) || 0;
var vacPct = parseFloat(document.getElementById('vacancyRate').value) || 0;
// Basic validations
if (price <= 0 || term 0) {
monthlyMortgage = loanAmount * (monthlyRate * Math.pow(1 + monthlyRate, numPayments)) / (Math.pow(1 + monthlyRate, numPayments) – 1);
} else {
monthlyMortgage = loanAmount / numPayments;
}
// Expense Calculations
var monthlyTax = tax / 12;
var monthlyIns = ins / 12;
var monthlyVacancyMaint = rent * (vacPct / 100);
// Total Operating Expenses (excluding mortgage)
var monthlyOperatingExpenses = monthlyTax + monthlyIns + hoa + monthlyVacancyMaint;
// Net Operating Income (NOI)
var monthlyNOI = rent – monthlyOperatingExpenses;
var annualNOI = monthlyNOI * 12;
// Total Costs (including mortgage)
var totalMonthlyCosts = monthlyOperatingExpenses + monthlyMortgage;
// Cash Flow
var monthlyCashFlow = rent – totalMonthlyCosts;
var annualCashFlow = monthlyCashFlow * 12;
// ROI Metrics
var totalCashInvested = downAmount; // Simplified (could add closing costs in future)
var cashOnCashROI = 0;
if (totalCashInvested > 0) {
cashOnCashROI = (annualCashFlow / totalCashInvested) * 100;
}
var capRate = 0;
if (price > 0) {
capRate = (annualNOI / price) * 100;
}
// Format formatting helper
function fmt(num) {
return "$" + num.toLocaleString('en-US', {minimumFractionDigits: 2, maximumFractionDigits: 2});
}
function fmtPct(num) {
return num.toFixed(2) + "%";
}
// Display Results
document.getElementById('resMortgage').innerText = fmt(monthlyMortgage);
document.getElementById('resExpenses').innerText = fmt(monthlyOperatingExpenses);
document.getElementById('resTotalCosts').innerText = fmt(totalMonthlyCosts);
document.getElementById('resNOI').innerText = fmt(monthlyNOI);
var cfElem = document.getElementById('resCashFlow');
cfElem.innerText = fmt(monthlyCashFlow);
if (monthlyCashFlow >= 0) {
cfElem.className = "result-value";
} else {
cfElem.className = "result-value negative";
}
var annualCfElem = document.getElementById('resAnnualCF');
annualCfElem.innerText = fmt(annualCashFlow);
annualCfElem.className = annualCashFlow >= 0 ? "result-value" : "result-value negative";
var roiElem = document.getElementById('resROI');
roiElem.innerText = fmtPct(cashOnCashROI);
roiElem.className = cashOnCashROI >= 0 ? "result-value" : "result-value negative";
document.getElementById('resCapRate').innerText = fmtPct(capRate);
// Show the box
document.getElementById('resultBox').style.display = "block";
}
Understanding Rental Property Cash Flow
Investing in real estate is one of the most popular ways to build long-term wealth, but success hinges on the numbers. This Rental Property Cash Flow Calculator is designed to help investors determine if a potential property will generate positive income or become a financial burden. Before signing a purchase agreement, understanding the difference between Gross Income, Net Operating Income (NOI), and Cash Flow is essential.
How the Calculator Works
Our calculator takes into account not just your mortgage payment, but the "hidden" costs of ownership that often surprise new landlords. Here is a breakdown of the key metrics calculated:
NOI (Net Operating Income): This is your total rental income minus operating expenses (Taxes, Insurance, HOA, Vacancy). It excludes mortgage payments and is used to calculate Cap Rate.
Cash Flow: This is the money left in your pocket after all expenses, including the mortgage. Positive cash flow means the property pays for itself and generates profit.
Cash-on-Cash ROI: This metric measures the return on the actual cash you invested (Down Payment), rather than the total loan value. It is arguably the most important metric for leverage investors.
What is a Good Cap Rate?
The Capitalization Rate (Cap Rate) helps you compare the profitability of a property assuming you paid all cash. While "good" varies by market, many investors look for a Cap Rate between 5% and 10%. A higher Cap Rate generally indicates higher returns but may come with higher risks or a less desirable location. Conversely, a lower Cap Rate often implies a safer, more stable asset with lower immediate returns.
Why Factor in Vacancy and Maintenance?
One of the biggest mistakes novice investors make is assuming 100% occupancy and zero repairs. In reality, tenants move out, and water heaters break. This calculator includes a field for "Vacancy/Maintenance Rate" (defaulting to a conservative 8%) to set aside a portion of monthly rent for these inevitable costs, ensuring your cash flow projections remain realistic.