Rental Property Cash-on-Cash Calculator
Cash-on-Cash Return
0.00%
Monthly Cash Flow
$0.00
Total Cash Invested
$0.00
Monthly Mortgage Payment (P&I)
$0.00
Annual Net Operating Income (NOI)
$0.00
Understanding Cash-on-Cash Return in Real Estate
For real estate investors, calculating the Cash-on-Cash Return (CoC) is essential for evaluating the performance of an income-producing property. Unlike standard ROI, which might look at the total value of the asset, CoC specifically measures the annual pre-tax cash flow relative to the actual cash invested.
This metric is particularly powerful because it accounts for leverage (the mortgage). A property might have a lower capitalization rate (Cap Rate), but if you use leverage effectively, your cash-on-cash return can be significantly higher.
How the Formula Works
The calculator above uses the standard industry formula for rental properties:
Cash on Cash Return = (Annual Pre-Tax Cash Flow / Total Cash Invested) x 100%
- Annual Cash Flow: Your gross rental income minus all operating expenses (taxes, insurance, maintenance, vacancy) and debt service (mortgage payments).
- Total Cash Invested: The sum of your down payment, closing costs, and any immediate repair or rehab costs required to get the property rent-ready.
What is a "Good" Return?
While target returns vary by market and investor strategy, most residential real estate investors aim for a Cash-on-Cash return between 8% and 12%. In highly competitive markets, investors might accept 5-7% anticipating appreciation, while in cash-flow heavy markets, returns of 15%+ are possible but often come with higher risk or management intensity.
Use this tool to analyze potential deals quickly. If the resulting percentage is negative, it means the property costs more to hold than it generates in income, requiring monthly contributions from your pocket to keep afloat.