function calculateCashFlow() {
// Get Inputs
var price = parseFloat(document.getElementById('rpc_price').value) || 0;
var downPayment = parseFloat(document.getElementById('rpc_down_payment').value) || 0;
var closingCosts = parseFloat(document.getElementById('rpc_closing_costs').value) || 0;
var rehabCosts = parseFloat(document.getElementById('rpc_rehab_costs').value) || 0;
var interestRate = parseFloat(document.getElementById('rpc_interest').value) || 0;
var loanTerm = parseFloat(document.getElementById('rpc_term').value) || 0;
var rent = parseFloat(document.getElementById('rpc_rent').value) || 0;
var vacancyRate = parseFloat(document.getElementById('rpc_vacancy').value) || 0;
var taxYear = parseFloat(document.getElementById('rpc_tax').value) || 0;
var insuranceYear = parseFloat(document.getElementById('rpc_insurance').value) || 0;
var mgmtRate = parseFloat(document.getElementById('rpc_mgmt').value) || 0;
var maintRate = parseFloat(document.getElementById('rpc_maint').value) || 0;
var hoaMonth = parseFloat(document.getElementById('rpc_hoa').value) || 0;
// Validation to prevent divide by zero or negative logic
if (price <= 0 || loanTerm 0) {
capRate = (noiYear / price) * 100;
}
var cocReturn = 0;
if (totalInvested > 0) {
cocReturn = (cashFlowYear / totalInvested) * 100;
}
// 5. Display Results
document.getElementById('res_mortgage').innerText = formatCurrency(mortgagePayment);
document.getElementById('res_expenses').innerText = formatCurrency(totalExpensesIncludingMortgage);
var noiEl = document.getElementById('res_noi');
noiEl.innerText = formatCurrency(noiMonth);
noiEl.className = noiMonth >= 0 ? 'rpc-positive' : 'rpc-negative';
var cfEl = document.getElementById('res_cashflow');
cfEl.innerText = formatCurrency(cashFlowMonth);
cfEl.className = cashFlowMonth >= 0 ? 'rpc-positive' : 'rpc-negative';
document.getElementById('res_total_invested').innerText = formatCurrency(totalInvested);
document.getElementById('res_cap_rate').innerText = capRate.toFixed(2) + "%";
var cocEl = document.getElementById('res_coc');
cocEl.innerText = cocReturn.toFixed(2) + "%";
cocEl.className = cocReturn >= 0 ? 'rpc-positive' : 'rpc-negative';
// Show result box
document.getElementById('rpc_result_box').style.display = 'block';
}
function formatCurrency(num) {
return "$" + num.toFixed(2).replace(/\d(?=(\d{3})+\.)/g, '$&,');
}
Understanding Rental Property Analysis
Investing in real estate is one of the most reliable ways to build wealth, but it requires precise calculations to ensure a property will be profitable. This Rental Property Cash Flow Calculator helps investors analyze potential deals by accounting for all income and expenses, providing a clear picture of the return on investment (ROI).
Why Cash Flow is King
Cash flow is the net amount of cash moving into or out of your investment each month. It is calculated by subtracting total expenses (including the mortgage) from the rental income. Positive cash flow means the property pays for itself and provides profit, while negative cash flow means you are losing money every month to hold the asset.
A good rule of thumb for many investors is to aim for at least $100 to $200 per door in monthly positive cash flow, though this varies by market and strategy.
Key Metrics Defined
NOI (Net Operating Income): This is your annual income minus operating expenses, excluding mortgage payments. It measures the profitability of the property itself, regardless of financing.
Cap Rate (Capitalization Rate): Calculated as NOI / Purchase Price. This percentage helps you compare the return of different properties as if you paid all cash. A higher cap rate generally implies a better return but may come with higher risk.
Cash on Cash Return (CoC): Calculated as Annual Cash Flow / Total Cash Invested. This is arguably the most important metric for leveraged investors, as it tells you how hard your actual cash deposit is working for you.
Estimating Expenses Correctly
One of the biggest mistakes new investors make is underestimating expenses. Beyond the mortgage, taxes, and insurance, you must account for:
Vacancy: Properties won't be rented 365 days a year. Setting aside 5-8% of rent helps cover turnover periods.
Maintenance & CapEx: Roofs leak and water heaters break. Allocating 5-10% of monthly rent for repairs ensures you have funds when things go wrong.
Management Fees: Even if you self-manage now, calculating a 10% management fee ensures the deal still works if you hire a professional later.
How to Use This Calculator
Start by entering the Purchase Information, including the price and your down payment. Next, input your Loan Details to determine your debt service. Under Monthly Income, enter the expected rent based on comparable properties in the area.
Finally, be honest with your Expenses. If you are unsure of the property tax, look up the local tax rate (often 1-2% of value). Once calculated, review the "Cash on Cash Return" to see if the investment meets your financial goals.