Analyze the profitability of your real estate investment.
Purchase Information
Loan Details
Income & Expenses (Monthly)
Investment Analysis
Total Cash Invested:$0.00
Monthly Mortgage Payment (P&I):$0.00
Total Monthly Expenses:$0.00
Monthly Net Cash Flow:$0.00
Annual Net Cash Flow:$0.00
Cash on Cash Return (CoC):0.00%
function calculateROI() {
// Get Input Values
var price = parseFloat(document.getElementById('purchasePrice').value);
var downPayment = parseFloat(document.getElementById('downPayment').value);
var closingCosts = parseFloat(document.getElementById('closingCosts').value);
var interestRate = parseFloat(document.getElementById('interestRate').value);
var loanTerm = parseFloat(document.getElementById('loanTerm').value);
var monthlyRent = parseFloat(document.getElementById('monthlyRent').value);
var vacancyRate = parseFloat(document.getElementById('vacancyRate').value);
var tax = parseFloat(document.getElementById('propertyTax').value);
var insurance = parseFloat(document.getElementById('insurance').value);
var maintenance = parseFloat(document.getElementById('maintenance').value);
// Validation
if (isNaN(price) || isNaN(downPayment) || isNaN(monthlyRent)) {
alert("Please enter valid numbers for Price, Down Payment, and Rent.");
return;
}
// 1. Calculate Mortgage
var loanAmount = price – downPayment;
var monthlyRate = (interestRate / 100) / 12;
var numberOfPayments = loanTerm * 12;
var mortgagePayment = 0;
if (interestRate > 0) {
mortgagePayment = loanAmount * (monthlyRate * Math.pow(1 + monthlyRate, numberOfPayments)) / (Math.pow(1 + monthlyRate, numberOfPayments) – 1);
} else {
mortgagePayment = loanAmount / numberOfPayments;
}
// 2. Calculate Effective Income
var vacancyLoss = monthlyRent * (vacancyRate / 100);
var effectiveGrossIncome = monthlyRent – vacancyLoss;
// 3. Calculate Total Expenses
var totalMonthlyFixedExpenses = tax + insurance + maintenance;
var totalMonthlyExpenses = mortgagePayment + totalMonthlyFixedExpenses;
// 4. Calculate Cash Flow
var monthlyCashFlow = effectiveGrossIncome – totalMonthlyExpenses;
var annualCashFlow = monthlyCashFlow * 12;
// 5. Calculate Total Investment
var totalCashInvested = downPayment + closingCosts;
// 6. Calculate CoC Return
var cocReturn = 0;
if (totalCashInvested > 0) {
cocReturn = (annualCashFlow / totalCashInvested) * 100;
}
// Formatting Helper
var formatter = new Intl.NumberFormat('en-US', {
style: 'currency',
currency: 'USD',
minimumFractionDigits: 2
});
// Display Results
document.getElementById('displayTotalInvested').innerHTML = formatter.format(totalCashInvested);
document.getElementById('displayMortgage').innerHTML = formatter.format(mortgagePayment);
document.getElementById('displayExpenses').innerHTML = formatter.format(totalMonthlyExpenses);
var flowEl = document.getElementById('displayMonthlyFlow');
flowEl.innerHTML = formatter.format(monthlyCashFlow);
flowEl.style.color = monthlyCashFlow >= 0 ? '#27ae60' : '#e74c3c';
var annualFlowEl = document.getElementById('displayAnnualFlow');
annualFlowEl.innerHTML = formatter.format(annualCashFlow);
annualFlowEl.style.color = annualCashFlow >= 0 ? '#27ae60' : '#e74c3c';
var cocEl = document.getElementById('displayCoC');
cocEl.innerHTML = cocReturn.toFixed(2) + "%";
cocEl.style.color = cocReturn >= 0 ? '#27ae60' : '#e74c3c';
// Show Results Area
document.getElementById('results-area').style.display = 'block';
}
Understanding Cash on Cash Return in Real Estate
When investing in rental properties, understanding your return on investment (ROI) is crucial. The Cash on Cash (CoC) Return is widely considered the most important metric for cash-flow investors. Unlike a standard Cap Rate, which looks at the property's performance regardless of financing, CoC Return measures the efficiency of the actual cash you put into the deal.
The Formula:
Cash on Cash Return = (Annual Pre-Tax Cash Flow / Total Cash Invested) × 100
Why Use This Calculator?
Real estate investors use this calculator to determine if a specific property meets their investment goals. A positive cash flow indicates the property generates income after all expenses are paid, while a high CoC percentage implies your money is working efficiently.
Key Inputs Explained
Down Payment: The initial equity portion of the purchase price. A lower down payment increases leverage but also increases the mortgage payment.
Closing Costs & Rehab: Don't forget to include inspection fees, origination fees, and immediate repair costs. These are part of your "Total Cash Invested."
Vacancy Rate: Properties are rarely occupied 100% of the time. A standard conservative estimate is 5-8% to account for turnover periods.
Maintenance: Setting aside 5-10% of monthly rent for repairs ensures you aren't caught off guard by a broken water heater or roof leak.
What is a Good Cash on Cash Return?
"Good" is subjective and depends on the economy and the investor's goals. Generally, a CoC return of 8% to 12% is considered solid for long-term buy-and-hold investors. However, in highly appreciating markets, investors might accept a lower CoC (3-5%) in exchange for potential equity growth, while investors in stable, low-appreciation markets often demand 12% or higher.
Example Scenario
Imagine you buy a rental home for $200,000. You put $40,000 down (20%) and pay $5,000 in closing costs. Your total cash invested is $45,000. After paying the mortgage, taxes, insurance, and management fees, the property nets you $400 a month in profit.
This means your money is growing at a rate of 10.66% annually, compounding through cash flow alone, not counting mortgage paydown or property appreciation.