function calculateCashFlow() {
// 1. Get Inputs using var
var price = parseFloat(document.getElementById('purchasePrice').value);
var downPct = parseFloat(document.getElementById('downPaymentPct').value);
var rate = parseFloat(document.getElementById('interestRate').value);
var term = parseInt(document.getElementById('loanTerm').value);
var rent = parseFloat(document.getElementById('monthlyRent').value);
var opsExpenses = parseFloat(document.getElementById('monthlyExpenses').value);
// 2. Validation
if (isNaN(price) || isNaN(downPct) || isNaN(rate) || isNaN(rent) || isNaN(opsExpenses)) {
alert("Please enter valid numbers for all fields.");
return;
}
// 3. Calculation Logic
// Loan Amount
var downPaymentAmount = price * (downPct / 100);
var loanAmount = price – downPaymentAmount;
// Closing Costs (Estimated at 3% of purchase price for calculation robustness)
var closingCosts = price * 0.03;
var initialCashInvested = downPaymentAmount + closingCosts;
// Monthly Mortgage Payment Formula: M = P [ i(1 + i)^n ] / [ (1 + i)^n – 1 ]
var monthlyRate = (rate / 100) / 12;
var numberOfPayments = term * 12;
var monthlyMortgage = 0;
if (rate === 0) {
monthlyMortgage = loanAmount / numberOfPayments;
} else {
monthlyMortgage = loanAmount * (monthlyRate * Math.pow(1 + monthlyRate, numberOfPayments)) / (Math.pow(1 + monthlyRate, numberOfPayments) – 1);
}
// Total Monthly Outflow
var totalMonthlyExpenses = monthlyMortgage + opsExpenses;
// Net Operating Income (Annual) = (Rent – Operating Expenses) * 12
// Note: NOI excludes mortgage debt service
var annualNOI = (rent – opsExpenses) * 12;
// Cash Flow
var monthlyCashFlow = rent – totalMonthlyExpenses;
var annualCashFlow = monthlyCashFlow * 12;
// Returns Metrics
var cashOnCash = (annualCashFlow / initialCashInvested) * 100;
var capRate = (annualNOI / price) * 100;
// 4. Update UI
document.getElementById('resultMortgage').innerText = "$" + monthlyMortgage.toLocaleString(undefined, {minimumFractionDigits: 2, maximumFractionDigits: 2});
document.getElementById('resultTotalExpenses').innerText = "$" + totalMonthlyExpenses.toLocaleString(undefined, {minimumFractionDigits: 2, maximumFractionDigits: 2});
var flowEl = document.getElementById('resultCashFlow');
flowEl.innerText = "$" + monthlyCashFlow.toLocaleString(undefined, {minimumFractionDigits: 2, maximumFractionDigits: 2});
// Styling for positive/negative cash flow
if (monthlyCashFlow >= 0) {
flowEl.classList.remove('negative-flow');
flowEl.classList.add('positive-flow');
} else {
flowEl.classList.remove('positive-flow');
flowEl.classList.add('negative-flow');
}
document.getElementById('resultCoC').innerText = cashOnCash.toFixed(2) + "%";
document.getElementById('resultCapRate').innerText = capRate.toFixed(2) + "%";
document.getElementById('resultNOI').innerText = "$" + annualNOI.toLocaleString(undefined, {minimumFractionDigits: 2, maximumFractionDigits: 2});
// Show results
document.getElementById('resultSection').style.display = "block";
}
Understanding Rental Property Cash Flow
Investing in real estate is one of the most reliable ways to build wealth, but the difference between a successful investment and a financial burden often comes down to one metric: Cash Flow. This Rental Property Cash Flow Calculator helps investors analyze the profitability of a potential purchase by accounting for mortgage costs, operating expenses, and rental income.
How is Cash Flow Calculated?
Positive cash flow occurs when your property's total income exceeds its total expenses. The formula used in this calculator is:
Gross Income: Your monthly rental income.
Minus Operating Expenses: Taxes, insurance, HOA fees, maintenance, and vacancy reserves.
Minus Debt Service: Your monthly mortgage principal and interest payment.
Equals Net Cash Flow: The money left in your pocket every month.
Key Investment Metrics Explained
Beyond simple monthly income, professional investors look at two critical percentages to judge a deal:
1. Cash on Cash Return (CoC)
This measures the return on the actual cash you invested (down payment + closing costs), not the total price of the home. It is calculated as (Annual Cash Flow / Total Cash Invested) x 100. A CoC return of 8-12% is often considered a solid target for residential rentals.
2. Cap Rate (Capitalization Rate)
Cap Rate measures the property's natural rate of return regardless of how it is financed. It is calculated as (Net Operating Income / Purchase Price) x 100. This metric allows you to compare the profitability of different properties directly, without the variable of your specific loan terms.
Why Use a Cash Flow Calculator?
Underestimating expenses is the #1 mistake new landlords make. By inputting realistic numbers for maintenance and vacancies (even if the property is currently occupied), you can ensure your investment can weather economic downturns. Always aim for positive cash flow to ensure the asset pays for itself while you benefit from long-term appreciation.