function calculateRental() {
// Retrieve inputs
var price = parseFloat(document.getElementById('purchasePrice').value) || 0;
var downPercent = parseFloat(document.getElementById('downPaymentPercent').value) || 0;
var rate = parseFloat(document.getElementById('interestRate').value) || 0;
var termYears = parseFloat(document.getElementById('loanTerm').value) || 0;
var closing = parseFloat(document.getElementById('closingCosts').value) || 0;
var repairs = parseFloat(document.getElementById('repairCosts').value) || 0;
var rent = parseFloat(document.getElementById('monthlyRent').value) || 0;
var taxYear = parseFloat(document.getElementById('propertyTax').value) || 0;
var insuranceYear = parseFloat(document.getElementById('insurance').value) || 0;
var hoa = parseFloat(document.getElementById('hoa').value) || 0;
var vacancyPercent = parseFloat(document.getElementById('vacancyRate').value) || 0;
var maintenancePercent = parseFloat(document.getElementById('maintenanceRate').value) || 0;
// Basic Calculations
var downPaymentAmount = price * (downPercent / 100);
var loanAmount = price – downPaymentAmount;
var totalCashInvested = downPaymentAmount + closing + repairs;
// Mortgage Payment Calculation (M = P [ i(1 + i)^n ] / [ (1 + i)^n – 1])
var monthlyRate = (rate / 100) / 12;
var numberOfPayments = termYears * 12;
var mortgagePayment = 0;
if (rate === 0) {
mortgagePayment = loanAmount / numberOfPayments;
} else {
mortgagePayment = loanAmount * (monthlyRate * Math.pow(1 + monthlyRate, numberOfPayments)) / (Math.pow(1 + monthlyRate, numberOfPayments) – 1);
}
// Operating Expenses
var vacancyCost = rent * (vacancyPercent / 100);
var maintenanceCost = rent * (maintenancePercent / 100);
var monthlyTax = taxYear / 12;
var monthlyInsurance = insuranceYear / 12;
var totalOperatingExpenses = monthlyTax + monthlyInsurance + hoa + vacancyCost + maintenanceCost;
var totalMonthlyExpenses = totalOperatingExpenses + mortgagePayment;
// Returns
var netOperatingIncome = rent – totalOperatingExpenses; // NOI excludes mortgage
var monthlyCashFlow = rent – totalMonthlyExpenses;
var annualCashFlow = monthlyCashFlow * 12;
var annualNOI = netOperatingIncome * 12;
// Metric Calculations
var cashOnCash = 0;
if (totalCashInvested > 0) {
cashOnCash = (annualCashFlow / totalCashInvested) * 100;
}
var capRate = 0;
if (price > 0) {
capRate = (annualNOI / price) * 100;
}
// Display Results
document.getElementById('res-cash-needed').innerText = '$' + totalCashInvested.toLocaleString(undefined, {minimumFractionDigits: 2, maximumFractionDigits: 2});
document.getElementById('res-mortgage').innerText = '$' + mortgagePayment.toLocaleString(undefined, {minimumFractionDigits: 2, maximumFractionDigits: 2});
document.getElementById('res-expenses').innerText = '$' + totalMonthlyExpenses.toLocaleString(undefined, {minimumFractionDigits: 2, maximumFractionDigits: 2});
document.getElementById('res-noi').innerText = '$' + netOperatingIncome.toLocaleString(undefined, {minimumFractionDigits: 2, maximumFractionDigits: 2});
var cashFlowEl = document.getElementById('res-cashflow');
cashFlowEl.innerText = '$' + monthlyCashFlow.toLocaleString(undefined, {minimumFractionDigits: 2, maximumFractionDigits: 2});
// Styling for positive/negative cash flow
if (monthlyCashFlow >= 0) {
cashFlowEl.style.color = '#27ae60';
} else {
cashFlowEl.style.color = '#c0392b';
}
document.getElementById('res-coc').innerText = cashOnCash.toFixed(2) + '%';
document.getElementById('res-cap').innerText = capRate.toFixed(2) + '%';
// Show results area
document.getElementById('results-area').style.display = 'block';
}
Mastering Real Estate Investment with a Rental Property Calculator
Real estate investing is one of the most reliable pathways to building long-term wealth, but it is not without its risks. The difference between a profitable asset and a money pit often comes down to the math. A Rental Property Cash Flow Calculator is an essential tool for investors to evaluate the potential performance of a property before signing any papers.
Whether you are looking at a single-family home, a duplex, or a vacation rental, understanding the relationship between income, expenses, and debt service is critical. This guide explains how to use the calculator above and interprets the key financial metrics it generates.
Expert Tip: Never rely solely on the "1% Rule" (where rent should be 1% of the purchase price). In today's market of high interest rates and fluctuating property values, a granular analysis of Cash on Cash return is far more accurate.
Key Inputs Explained
Purchase Price & Down Payment: These determine your loan amount. A higher down payment reduces your monthly mortgage but increases your initial cash investment, potentially lowering your Cash on Cash return.
Operating Expenses: Many new investors calculate mortgage and taxes but forget Vacancy (the cost of the property sitting empty) and Maintenance (saving for roof repairs, HVAC, etc.). A safe conservative estimate is often 5-10% for each.
Closing & Repair Costs: These are "sunk costs" required to get the property operational. They must be included in your "Total Cash Needed" to get an accurate ROI figure.
Understanding the Results
1. Monthly Cash Flow
This is the net profit you pocket every month after all expenses are paid, including the mortgage. Positive cash flow means the asset pays you to own it. Negative cash flow means you are feeding the property money every month.
2. Net Operating Income (NOI)
NOI is the profitability of the property excluding any loans. It is calculated as Total Income - Operating Expenses. NOI is crucial because it helps you compare the profitability of two buildings regardless of how they are financed.
3. Cash on Cash Return (CoC)
This is arguably the most important metric for rental investors. It answers the question: "For every dollar I invest, how much do I get back annually?"
The formula is: (Annual Cash Flow / Total Cash Invested) * 100.
For example, if you invest $50,000 cash to buy a house that generates $5,000 in positive cash flow per year, your CoC return is 10%. This allows you to compare real estate returns directly against stocks or bonds.
4. Cap Rate (Capitalization Rate)
Cap Rate measures the natural rate of return of the property if you bought it in all cash. It indicates the risk and potential of the local market. A higher cap rate usually implies higher risk or a lower-value area, while a lower cap rate suggests a stable, high-demand area.
Why Use This Calculator?
Using a specialized rental property calculator allows you to stress-test your investment. What happens if vacancy rises to 10%? What if interest rates go up by 1%? By adjusting the inputs above, you can see how sensitive your profit margins are to market changes, allowing you to make data-driven investment decisions.