function calculateCashFlow() {
// 1. Get Inputs
var price = parseFloat(document.getElementById('purchasePrice').value) || 0;
var downPercent = parseFloat(document.getElementById('downPayment').value) || 0;
var closingCosts = parseFloat(document.getElementById('closingCosts').value) || 0;
var interestRate = parseFloat(document.getElementById('interestRate').value) || 0;
var termYears = parseFloat(document.getElementById('loanTerm').value) || 0;
var rent = parseFloat(document.getElementById('monthlyRent').value) || 0;
var taxYear = parseFloat(document.getElementById('annualTax').value) || 0;
var insYear = parseFloat(document.getElementById('annualInsurance').value) || 0;
var vacancyPercent = parseFloat(document.getElementById('vacancyRate').value) || 0;
var maintPercent = parseFloat(document.getElementById('maintenanceRate').value) || 0;
var mgmtPercent = parseFloat(document.getElementById('managementFee').value) || 0;
var hoaMonth = parseFloat(document.getElementById('hoaFees').value) || 0;
// 2. Loan Calculations
var downAmount = price * (downPercent / 100);
var loanAmount = price – downAmount;
var monthlyRate = (interestRate / 100) / 12;
var numPayments = termYears * 12;
var mortgagePayment = 0;
if (monthlyRate > 0 && numPayments > 0) {
mortgagePayment = loanAmount * (monthlyRate * Math.pow(1 + monthlyRate, numPayments)) / (Math.pow(1 + monthlyRate, numPayments) – 1);
} else if (numPayments > 0) {
mortgagePayment = loanAmount / numPayments;
}
// 3. Expense Calculations (Monthly)
var taxMonth = taxYear / 12;
var insMonth = insYear / 12;
var vacancyCost = rent * (vacancyPercent / 100);
var maintCost = rent * (maintPercent / 100);
var mgmtCost = rent * (mgmtPercent / 100);
var totalOperatingExpenses = taxMonth + insMonth + vacancyCost + maintCost + mgmtCost + hoaMonth;
var totalExpenses = totalOperatingExpenses + mortgagePayment;
// 4. Profit Metrics
var monthlyCashFlow = rent – totalExpenses;
var annualCashFlow = monthlyCashFlow * 12;
var annualNOI = (rent * 12) – (totalOperatingExpenses * 12);
var totalInitialInvestment = downAmount + closingCosts;
var cocReturn = 0;
if (totalInitialInvestment > 0) {
cocReturn = (annualCashFlow / totalInitialInvestment) * 100;
}
var capRate = 0;
if (price > 0) {
capRate = (annualNOI / price) * 100;
}
// 5. Display Results
document.getElementById('res-mortgage').innerText = formatCurrency(mortgagePayment);
document.getElementById('res-expenses').innerText = formatCurrency(totalExpenses);
var cfElement = document.getElementById('res-cashflow');
cfElement.innerText = formatCurrency(monthlyCashFlow);
if(monthlyCashFlow >= 0) {
cfElement.className = "result-value highlight-positive";
} else {
cfElement.className = "result-value highlight-negative";
}
document.getElementById('res-noi').innerText = formatCurrency(annualNOI);
document.getElementById('res-coc').innerText = cocReturn.toFixed(2) + "%";
document.getElementById('res-cap').innerText = capRate.toFixed(2) + "%";
document.getElementById('calc-results').style.display = 'block';
}
function formatCurrency(num) {
return "$" + num.toFixed(2).replace(/\d(?=(\d{3})+\.)/g, '$&,');
}
Understanding Rental Property Cash Flow
Investing in real estate is one of the most reliable ways to build wealth, but simply buying a property and renting it out doesn't guarantee profit. A detailed Rental Property Cash Flow Calculator is essential for investors to analyze the viability of a potential deal before signing any papers.
What is Cash Flow?
Cash flow is the net amount of cash moving into and out of a business. In real estate, it represents the money remaining after all expenses, including the mortgage, taxes, insurance, and maintenance reserves, have been paid from the rental income. Positive cash flow means the property generates income for you every month, while negative cash flow means you are paying out of pocket to hold the asset.
Key Metrics Explained
NOI (Net Operating Income): This is your annual rental income minus all operating expenses (taxes, insurance, maintenance, vacancy), excluding mortgage payments. It measures the property's raw profitability.
Cash on Cash Return (CoC): This metric calculates the cash income earned on the cash invested in the property. It is calculated by dividing the annual pre-tax cash flow by the total cash invested (down payment + closing costs + rehab costs). A CoC return of 8-12% is often considered a solid benchmark for rental investors.
Cap Rate (Capitalization Rate): The Cap Rate indicates the rate of return on a real estate investment property based on the income that the property is expected to generate. It is calculated by dividing the NOI by the current market value (or purchase price) of the asset.
Why Include Vacancy and Maintenance?
Novice investors often make the mistake of calculating profit by simply subtracting the mortgage from the rent. However, real-world expenses are inevitable.
Vacancy Rate: Properties will not be occupied 100% of the time. Budgeting 5-8% for vacancy ensures you have funds to cover the mortgage during turnover periods.
Maintenance & Repairs: Roofs leak, toilets break, and water heaters fail. Setting aside 5-10% of monthly rent creates a "CapEx" (Capital Expenditure) fund so these costs don't destroy your returns when they happen.
How to Use This Calculator
Enter your purchase details, financing terms, and estimated expenses above. Be conservative with your estimates—it is better to underestimate income and overestimate expenses. If the Monthly Cash Flow is green, the property pays for itself and provides passive income. If it is red, proceed with caution, as the property will be a liability unless appreciation or tax benefits offset the monthly loss.