function calculateCashFlow() {
// Get Inputs
var monthlyRent = parseFloat(document.getElementById('monthlyRent').value) || 0;
var otherIncome = parseFloat(document.getElementById('otherIncome').value) || 0;
var mortgagePayment = parseFloat(document.getElementById('mortgagePayment').value) || 0;
var propertyTax = parseFloat(document.getElementById('propertyTax').value) || 0;
var insurance = parseFloat(document.getElementById('insurance').value) || 0;
var hoaFees = parseFloat(document.getElementById('hoaFees').value) || 0;
var vacancyRate = parseFloat(document.getElementById('vacancyRate').value) || 0;
var repairsRate = parseFloat(document.getElementById('repairs').value) || 0;
var capExRate = parseFloat(document.getElementById('capEx').value) || 0;
var managementRate = parseFloat(document.getElementById('managementFee').value) || 0;
// Calculations
var grossIncome = monthlyRent + otherIncome;
// Variable Costs Calculation
var vacancyCost = monthlyRent * (vacancyRate / 100);
var repairsCost = monthlyRent * (repairsRate / 100);
var capExCost = monthlyRent * (capExRate / 100);
var managementCost = monthlyRent * (managementRate / 100);
var effectiveIncome = grossIncome – vacancyCost;
// Total Operating Expenses (excluding mortgage)
var fixedExpenses = propertyTax + insurance + hoaFees;
var variableExpenses = repairsCost + capExCost + managementCost;
var totalExpenses = fixedExpenses + variableExpenses;
var noi = effectiveIncome – totalExpenses;
var cashFlow = noi – mortgagePayment;
var annualCashFlow = cashFlow * 12;
// Update Display
document.getElementById('resultsArea').style.display = 'block';
document.getElementById('displayGrossIncome').innerText = formatCurrency(grossIncome);
document.getElementById('displayVacancy').innerText = "-" + formatCurrency(vacancyCost);
document.getElementById('displayEffectiveIncome').innerText = formatCurrency(effectiveIncome);
document.getElementById('displayExpenses').innerText = "-" + formatCurrency(totalExpenses);
document.getElementById('displayNOI').innerText = formatCurrency(noi);
document.getElementById('displayMortgage').innerText = "-" + formatCurrency(mortgagePayment);
var cashFlowEl = document.getElementById('displayCashFlow');
cashFlowEl.innerText = formatCurrency(cashFlow);
// Color coding for cash flow
if (cashFlow >= 0) {
cashFlowEl.className = "positive-flow";
} else {
cashFlowEl.className = "negative-flow";
}
var annualEl = document.getElementById('displayAnnualCashFlow');
annualEl.innerText = formatCurrency(annualCashFlow);
if (annualCashFlow >= 0) {
annualEl.style.color = "#27ae60";
} else {
annualEl.style.color = "#c0392b";
}
}
function formatCurrency(num) {
return "$" + num.toFixed(2).replace(/\d(?=(\d{3})+\.)/g, '$&,');
}
Understanding Rental Property Cash Flow
Cash flow is the lifeblood of any rental real estate investment. It represents the net amount of cash moving in or out of a business at any given time. For real estate investors, calculating accurate cash flow is critical to determine if a property will generate a profit after all expenses and debt service are paid.
This Rental Property Cash Flow Calculator helps investors analyze deals by breaking down income, fixed expenses, and variable estimates that are often overlooked by novices.
How to Calculate Rental Cash Flow
The basic formula for calculating rental property cash flow is straightforward, though the components can be detailed:
Gross Income: The total rent collected plus any additional income sources like laundry facilities or parking fees.
Vacancy Rate: No property is occupied 100% of the time. A standard conservative estimate is 5-8% to account for turnover periods between tenants.
NOI (Net Operating Income): This is your income minus all operating expenses (Taxes, Insurance, HOA, Maintenance) but before the mortgage is paid. NOI is crucial for calculating Cap Rate.
CapEx (Capital Expenditures): Funds set aside for major future replacements, such as a new roof, HVAC system, or water heater.
What is a "Good" Cash Flow?
While "good" is subjective based on your investment strategy, many investors look for a minimum of $100 – $200 per door, per month in positive cash flow. Others focus on Cash-on-Cash Return, aiming for 8-12% or higher. It is vital to use realistic estimates for repairs and vacancy; underestimating these costs is the most common mistake leading to negative cash flow.
Using the Calculator
To use the tool above effectively, input your monthly rental income and all associated costs. Don't forget to include a percentage for property management (typically 8-10%) even if you self-manage, as this helps value your time and prepares the numbers for future outsourcing.