Monthly Mortgage Payment (P&I):$0.00 Total Monthly Expenses:$0.00
Understanding Rental Property Cash Flow
Success in real estate investing isn't about guessing; it's about the math. Whether you are analyzing a long-term rental, a BRRRR strategy, or a potential Airbnb, the Rental Property Cash Flow Calculator helps you determine the viability of an investment deal before you sign on the dotted line.
Why Calculate Cash Flow?
Cash flow is the net amount of cash moving into and out of a business. In real estate, positive cash flow means the property's income exceeds all expenses, including the mortgage. This is the "passive income" investors seek. Negative cash flow means you are losing money every month to hold the property.
Key Inputs Explained
Vacancy Rate: No property is occupied 100% of the time. A standard conservative estimate is 5-8% (about 2-3 weeks of vacancy per year).
Maintenance Reserves: Things break. Smart investors set aside 5-10% of the rent every month to cover future repairs (roof, HVAC, painting).
Capital Expenditures (CapEx): Major replacements like roofs or water heaters.
Interpreting Your Results
1. Monthly Cash Flow
This is your "take-home" profit after paying the bank, the taxman, insurance, and maintenance costs. Formula: Effective Gross Income – Operating Expenses – Debt Service
2. Cash on Cash Return (CoC)
This metric tells you how hard your actual invested cash is working. It compares your annual pre-tax cash flow to the total cash invested (Down Payment + Closing Costs + Rehab). A CoC of 8-12% is generally considered a good target for residential rentals, though this varies by market.
3. Cap Rate (Capitalization Rate)
The Cap Rate measures the property's natural rate of return assuming you bought it with all cash (no loan). It is calculated by dividing the Net Operating Income (NOI) by the Property Value. This helps you compare properties irrespective of financing.
4. Net Operating Income (NOI)
NOI is the profitability of the property before mortgage payments are deducted. Lenders look closely at this number to ensure the property generates enough income to cover the debt.
Disclaimer: This calculator is for educational purposes only. Always consult with a financial advisor or real estate professional before making investment decisions.
function calculateCashFlow() {
// 1. Get Input Values
var price = parseFloat(document.getElementById('purchasePrice').value);
var downPercent = parseFloat(document.getElementById('downPaymentPercent').value);
var interestRate = parseFloat(document.getElementById('interestRate').value);
var years = parseFloat(document.getElementById('loanTerm').value);
var rent = parseFloat(document.getElementById('monthlyRent').value);
var vacancyRate = parseFloat(document.getElementById('vacancyRate').value);
var taxAnnual = parseFloat(document.getElementById('annualTaxes').value);
var insuranceAnnual = parseFloat(document.getElementById('annualInsurance').value);
var hoaMonthly = parseFloat(document.getElementById('monthlyHOA').value);
var maintMonthly = parseFloat(document.getElementById('monthlyMaintenance').value);
// Validation to prevent NaN
if (isNaN(price) || isNaN(rent) || isNaN(downPercent)) {
alert("Please enter valid numbers for Price, Rent, and Down Payment.");
return;
}
// 2. Core Calculations
// Loan Calculation
var downPaymentAmount = price * (downPercent / 100);
var loanAmount = price – downPaymentAmount;
var monthlyRate = (interestRate / 100) / 12;
var numberOfPayments = years * 12;
// Mortgage P&I Formula: M = P [ i(1 + i)^n ] / [ (1 + i)^n – 1 ]
var mortgagePayment = 0;
if (interestRate > 0) {
mortgagePayment = loanAmount * (monthlyRate * Math.pow(1 + monthlyRate, numberOfPayments)) / (Math.pow(1 + monthlyRate, numberOfPayments) – 1);
} else {
mortgagePayment = loanAmount / numberOfPayments;
}
// Income Calculations
var vacancyLoss = rent * (vacancyRate / 100);
var effectiveGrossIncome = rent – vacancyLoss;
// Expense Calculations
var monthlyTax = taxAnnual / 12;
var monthlyInsurance = insuranceAnnual / 12;
var totalOperatingExpenses = monthlyTax + monthlyInsurance + hoaMonthly + maintMonthly; // NOI expenses (excludes mortgage)
var totalMonthlyExpenses = totalOperatingExpenses + mortgagePayment;
// Metric Calculations
var monthlyNOI = effectiveGrossIncome – totalOperatingExpenses;
var monthlyCashFlow = effectiveGrossIncome – totalMonthlyExpenses;
var annualCashFlow = monthlyCashFlow * 12;
var annualNOI = monthlyNOI * 12;
// Cash on Cash Return = Annual Cash Flow / Total Cash Invested
// Assuming Closing costs are roughly 2% of price for estimation in CoC or just using Down Payment if simplistic
// Let's stick to Down Payment for simplicity unless we add an input, but to be accurate let's add 2% closing cost est.
// For this specific logic, I will calculate based strictly on Down Payment to match inputs provided.
var totalCashInvested = downPaymentAmount;
var cashOnCash = 0;
if (totalCashInvested > 0) {
cashOnCash = (annualCashFlow / totalCashInvested) * 100;
}
// Cap Rate = Annual NOI / Purchase Price
var capRate = (annualNOI / price) * 100;
// 3. Display Results
// Helper function for formatting currency
function formatMoney(num) {
return '$' + num.toFixed(2).replace(/\d(?=(\d{3})+\.)/g, '$&,');
}
document.getElementById('displayCashFlow').innerHTML = formatMoney(monthlyCashFlow);
document.getElementById('displayCoC').innerHTML = cashOnCash.toFixed(2) + '%';
document.getElementById('displayCapRate').innerHTML = capRate.toFixed(2) + '%';
document.getElementById('displayNOI').innerHTML = formatMoney(monthlyNOI);
document.getElementById('displayMortgage').innerHTML = formatMoney(mortgagePayment);
document.getElementById('displayTotalExpenses').innerHTML = formatMoney(totalMonthlyExpenses);
// Visual Styling for Positive/Negative Cash Flow
var cfCard = document.getElementById('cashFlowCard');
if (monthlyCashFlow >= 0) {
cfCard.className = "result-card positive";
document.getElementById('displayCashFlow').style.color = "#27ae60";
} else {
cfCard.className = "result-card negative";
document.getElementById('displayCashFlow').style.color = "#c0392b";
}
// Show results div
document.getElementById('results').style.display = "block";
}