Rental Property Cash Flow Calculator
Investment Analysis
Monthly Mortgage (P&I):
$0.00
Total Monthly Expenses:
$0.00
Net Monthly Cash Flow:
$0.00
Annual Cash Flow:
$0.00
Cash on Cash Return (ROI):
0.00%
Understanding Rental Property Cash Flow
Investing in real estate is one of the most reliable ways to build wealth, but the success of any rental property hinges on the numbers. This Rental Property Cash Flow Calculator is designed to help investors quickly determine the viability of a potential deal by analyzing income, expenses, and financing costs.
What is Cash Flow?
Cash flow is the net amount of money left in your pocket after all expenses are paid. It is calculated as:
Cash Flow = Total Rental Income – (Mortgage Payments + Operating Expenses)
Positive cash flow means the property pays for itself and generates profit. Negative cash flow indicates the property costs you money to hold every month.
Key Metrics Explained
- Vacancy Rate: No property is occupied 100% of the time. A standard safety margin is 5-8% to account for turnover periods.
- Maintenance: Setting aside 10-15% of monthly rent helps cover future repairs (like a broken water heater) and capital expenditures (like a new roof).
- Cash on Cash Return (CoC): This is arguably the most important metric for ROI. It measures the annual cash flow relative to the total cash invested (Down Payment + Closing Costs). A CoC return of 8-12% is often considered a solid benchmark for rental investors.
How to Improve Your ROI
If the calculator shows a negative cash flow or low ROI, consider these adjustments: increasing the down payment to lower the mortgage, negotiating a lower purchase price, or looking for ways to value-add to the property to justify higher rent.