function calculateCashFlow() {
// Get Inputs
var price = parseFloat(document.getElementById('rpPrice').value);
var downPayment = parseFloat(document.getElementById('rpDownPayment').value);
var closingCosts = parseFloat(document.getElementById('rpClosingCosts').value);
var interestRate = parseFloat(document.getElementById('rpInterestRate').value);
var loanTerm = parseFloat(document.getElementById('rpLoanTerm').value);
var monthlyRent = parseFloat(document.getElementById('rpMonthlyRent').value);
var propTax = parseFloat(document.getElementById('rpPropTax').value);
var insurance = parseFloat(document.getElementById('rpInsurance').value);
var hoa = parseFloat(document.getElementById('rpHOA').value);
var maintenance = parseFloat(document.getElementById('rpMaintenance').value);
// Validation
if (isNaN(price) || isNaN(downPayment) || isNaN(monthlyRent)) {
alert("Please enter valid numbers for Price, Down Payment, and Rent.");
return;
}
// Mortgage Calculation
var principal = price – downPayment;
var monthlyRate = (interestRate / 100) / 12;
var numberOfPayments = loanTerm * 12;
var monthlyMortgage = 0;
if (interestRate === 0) {
monthlyMortgage = principal / numberOfPayments;
} else {
monthlyMortgage = (principal * monthlyRate * Math.pow(1 + monthlyRate, numberOfPayments)) / (Math.pow(1 + monthlyRate, numberOfPayments) – 1);
}
// Expense Calculations
var monthlyTax = propTax / 12;
var monthlyInsurance = insurance / 12;
var totalMonthlyExpenses = monthlyMortgage + monthlyTax + monthlyInsurance + hoa + maintenance;
// Income & Cash Flow Calculations
var monthlyCashFlow = monthlyRent – totalMonthlyExpenses;
var annualCashFlow = monthlyCashFlow * 12;
var annualNOI = (monthlyRent * 12) – (totalMonthlyExpenses * 12) + (monthlyMortgage * 12); // NOI excludes Debt Service (P&I)
// ROI Calculations
var totalInvested = downPayment + closingCosts;
var cocReturn = 0;
if (totalInvested > 0) {
cocReturn = (annualCashFlow / totalInvested) * 100;
}
var capRate = 0;
if (price > 0) {
capRate = (annualNOI / price) * 100;
}
// Display Results
document.getElementById('resMortgage').innerText = "$" + monthlyMortgage.toFixed(2).replace(/\d(?=(\d{3})+\.)/g, '$&,');
document.getElementById('resTotalExpenses').innerText = "$" + totalMonthlyExpenses.toFixed(2).replace(/\d(?=(\d{3})+\.)/g, '$&,');
document.getElementById('resNOI').innerText = "$" + annualNOI.toFixed(2).replace(/\d(?=(\d{3})+\.)/g, '$&,');
var cashFlowEl = document.getElementById('resCashFlow');
cashFlowEl.innerText = "$" + monthlyCashFlow.toFixed(2).replace(/\d(?=(\d{3})+\.)/g, '$&,');
if (monthlyCashFlow < 0) {
cashFlowEl.classList.add('negative');
} else {
cashFlowEl.classList.remove('negative');
}
var cocEl = document.getElementById('resCoC');
cocEl.innerText = cocReturn.toFixed(2) + "%";
if (cocReturn < 0) {
cocEl.classList.add('negative');
} else {
cocEl.classList.remove('negative');
}
document.getElementById('resCapRate').innerText = capRate.toFixed(2) + "%";
// Show result div
document.getElementById('rpResult').style.display = "block";
}
Understanding Rental Property Cash Flow
Investing in real estate is one of the most reliable ways to build wealth, but simply buying a property doesn't guarantee profit. The most critical metric for buy-and-hold investors is Cash Flow. This Rental Property Cash Flow Calculator helps you evaluate the profitability of a potential investment by factoring in income, operating expenses, and debt service.
How to Use This Calculator
To get an accurate estimate of your potential returns, you will need to input specific details about the property and financing:
Purchase Information: Enter the price of the home, your down payment, and expected closing costs. Financing details like interest rate and loan term are crucial for calculating the mortgage payment.
Income: The total monthly rent you expect to collect. Be realistic—check comparable rentals in the area (comps).
Expenses: This is where many investors make mistakes. Beyond the mortgage, remember to account for Property Taxes, Insurance, HOA fees, and Maintenance reserves (usually 5-10% of rent).
Key Metrics Explained
This calculator provides three vital indicators of an investment's health:
1. Monthly Cash Flow
This is the money left in your pocket after paying all expenses and the mortgage.
Formula: Monthly Rent – (Mortgage + Taxes + Insurance + HOA + Maintenance).
Positive cash flow is essential for long-term sustainability. For example, if you collect $2,500 in rent and your total outflows are $2,200, your cash flow is $300/month.
2. Cash on Cash Return (CoC)
This metric measures the percentage return on the actual cash you invested (Down Payment + Closing Costs). It is often considered the most important metric for ROI in the first year.
Formula: (Annual Cash Flow / Total Cash Invested) x 100.
A CoC return of 8-12% is generally considered good for rental properties, though this varies by market.
3. Cap Rate (Capitalization Rate)
Cap Rate measures the natural rate of return of the property assuming you bought it with all cash (no loan). It helps compare properties regardless of financing.
Formula: (Net Operating Income / Purchase Price) x 100.
Why Maintenance Reserves Matter
Even if a house is brand new, things break. Vacancies happen. Our calculator includes a "Maintenance/CapEx" field. It is wise to allocate at least 5% to 10% of the monthly rent into a savings fund for future repairs (like a new roof or water heater) and vacancy periods. Failure to account for these can turn a seemingly profitable deal into a money pit.