function calculateRental() {
// 1. Get Input Values
var price = parseFloat(document.getElementById('rp_price').value) || 0;
var closing = parseFloat(document.getElementById('rp_closing').value) || 0;
var downPercent = parseFloat(document.getElementById('rp_down').value) || 0;
var rate = parseFloat(document.getElementById('rp_rate').value) || 0;
var term = parseFloat(document.getElementById('rp_term').value) || 0;
var rent = parseFloat(document.getElementById('rp_rent').value) || 0;
var vacancyRate = parseFloat(document.getElementById('rp_vacancy').value) || 0;
var taxYear = parseFloat(document.getElementById('rp_tax').value) || 0;
var insuranceYear = parseFloat(document.getElementById('rp_insurance').value) || 0;
var hoaMo = parseFloat(document.getElementById('rp_hoa').value) || 0;
var maintRate = parseFloat(document.getElementById('rp_maint').value) || 0;
var mgmtRate = parseFloat(document.getElementById('rp_mgmt').value) || 0;
// 2. Logic Calculations
// Investment Basics
var downPaymentAmount = price * (downPercent / 100);
var loanAmount = price – downPaymentAmount;
var totalInvested = downPaymentAmount + closing;
// Mortgage Calculation
var monthlyRate = (rate / 100) / 12;
var numPayments = term * 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;
}
// Operating Expenses
var vacancyCost = rent * (vacancyRate / 100);
var maintCost = rent * (maintRate / 100);
var mgmtCost = rent * (mgmtRate / 100);
var taxMo = taxYear / 12;
var insuranceMo = insuranceYear / 12;
var operatingExpensesMo = taxMo + insuranceMo + hoaMo + vacancyCost + maintCost + mgmtCost;
var totalExpensesMo = operatingExpensesMo + mortgagePayment;
// Income Metrics
var effectiveGrossIncome = rent – vacancyCost; // Some definitions vary, but simple CF view
// Adjusting NOI calculation: NOI = (Rent – Vacancy) – Operating Expenses (excluding debt service)
// Wait, Operating Expenses above included Vacancy cost in the sum, so NOI = Rent – OperatingExpensesMo
var noiMo = rent – operatingExpensesMo;
var noiAnnual = noiMo * 12;
var cashFlowMo = rent – totalExpensesMo; // Rent is gross potential, Vacancy is treated as expense here for simple sum
// Actually, precise way: Gross Rent – Vacancy = Effective Income.
// Effective Income – (Opex + Debt) = Cash Flow.
// My totalExpensesMo includes vacancy cost. So: Rent – (Opex + Vacancy + Debt) is correct math.
var cashFlowAnnual = cashFlowMo * 12;
// Returns
var coc = 0;
if (totalInvested > 0) {
coc = (cashFlowAnnual / totalInvested) * 100;
}
var capRate = 0;
if (price > 0) {
capRate = (noiAnnual / price) * 100;
}
// 3. Update DOM
var cfEl = document.getElementById('res_cashflow_mo');
cfEl.innerText = formatCurrency(cashFlowMo);
cfEl.className = cashFlowMo >= 0 ? "result-value highlight-result" : "result-value highlight-result neg-result";
document.getElementById('res_cashflow_yr').innerText = formatCurrency(cashFlowAnnual);
document.getElementById('res_coc').innerText = coc.toFixed(2) + "%";
document.getElementById('res_cap').innerText = capRate.toFixed(2) + "%";
document.getElementById('res_noi').innerText = formatCurrency(noiAnnual);
document.getElementById('res_invested').innerText = formatCurrency(totalInvested);
document.getElementById('res_mortgage').innerText = formatCurrency(mortgagePayment);
document.getElementById('res_expenses').innerText = formatCurrency(totalExpensesMo);
document.getElementById('rp_results').style.display = "block";
}
function formatCurrency(num) {
return "$" + num.toFixed(2).replace(/\d(?=(\d{3})+\.)/g, '$&,');
}
Understanding Rental Property Cash Flow Analysis
Investing in real estate is a numbers game. Whether you are a seasoned investor or buying your first rental property, accurately calculating your cash flow is critical to ensuring your investment is profitable. This Rental Property Cash Flow Calculator helps you account for income, operating expenses, and debt service to determine the true viability of a deal.
Key Metrics Explained
1. Net Operating Income (NOI)
NOI is one of the most important figures in real estate. It represents the total income the property generates after all operating expenses are paid, but before the mortgage (debt service) is paid. A high NOI indicates a property that operates efficiently.
Formula: (Gross Rental Income – Vacancy Losses) – Operating Expenses
2. Cash on Cash Return (CoC)
This metric tells you how hard your actual invested cash is working for you. Unlike simple ROI, it focuses specifically on the money you paid out of pocket (Down Payment + Closing Costs). A healthy CoC for rental properties is often considered to be between 8% and 12%, though this varies by market.
Formula: (Annual Pre-Tax Cash Flow / Total Cash Invested) × 100
3. Cap Rate (Capitalization Rate)
The Cap Rate measures the natural rate of return on the property assuming you bought it all cash (no loan). It allows you to compare properties of different prices and financing structures on an apples-to-apples basis.
Formula: (Net Operating Income / Purchase Price) × 100
Hidden Expenses Often Overlooked
Many new investors make the mistake of calculating cash flow by simply subtracting the mortgage from the rent. To get an accurate result, you must input realistic estimates for:
- Vacancy Rate: Properties will not be occupied 100% of the time. A standard conservative estimate is 5% to 8% (roughly 2-4 weeks per year).
- Repairs & Maintenance: Even if the house is new, things break. Budgeting 5% to 10% of monthly rent ensures you have funds for leaky faucets or HVAC issues.
- Management Fees: If you hire a property manager, they typically charge 8% to 12% of the monthly rent. Even if you self-manage, you should account for this "cost of labor."
- CapEx (Capital Expenditures): These are big-ticket items like roof replacements or water heaters. While not monthly costs, they should be saved for monthly.
Use the calculator above to adjust these variables and see how they impact your monthly bottom line. A positive cash flow provides a buffer against market downturns and allows for portfolio growth.