function calculateRental() {
// Get Input Values
var price = parseFloat(document.getElementById('rp_price').value) || 0;
var closingCosts = parseFloat(document.getElementById('rp_closing_costs').value) || 0;
var downPercent = parseFloat(document.getElementById('rp_down_percent').value) || 0;
var rate = parseFloat(document.getElementById('rp_rate').value) || 0;
var termYears = parseFloat(document.getElementById('rp_term').value) || 30;
var rent = parseFloat(document.getElementById('rp_rent').value) || 0;
var taxAnnual = parseFloat(document.getElementById('rp_tax').value) || 0;
var insuranceAnnual = parseFloat(document.getElementById('rp_insurance').value) || 0;
var hoa = parseFloat(document.getElementById('rp_hoa').value) || 0;
var maintenancePercent = parseFloat(document.getElementById('rp_maintenance').value) || 0;
var vacancyPercent = parseFloat(document.getElementById('rp_vacancy').value) || 0;
// Calculations – Loan
var downPayment = price * (downPercent / 100);
var loanAmount = price – downPayment;
var totalInitialInvestment = downPayment + closingCosts;
// Mortgage Calculation
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);
}
// Calculations – Expenses
var monthlyTax = taxAnnual / 12;
var monthlyInsurance = insuranceAnnual / 12;
var monthlyMaintenance = rent * (maintenancePercent / 100);
var monthlyVacancy = rent * (vacancyPercent / 100);
var totalOperatingExpenses = monthlyTax + monthlyInsurance + hoa + monthlyMaintenance + monthlyVacancy;
var totalMonthlyExpenses = totalOperatingExpenses + mortgagePayment;
// Calculations – Metrics
var monthlyCashFlow = rent – totalMonthlyExpenses;
var annualCashFlow = monthlyCashFlow * 12;
// Net Operating Income (NOI) = Income – Operating Expenses (Not including mortgage)
var monthlyNOI = rent – totalOperatingExpenses;
var annualNOI = monthlyNOI * 12;
// Cap Rate = (Annual NOI / Price) * 100
var capRate = (annualNOI / price) * 100;
// Cash on Cash Return = (Annual Cash Flow / Total Initial Investment) * 100
var cashOnCash = 0;
if (totalInitialInvestment > 0) {
cashOnCash = (annualCashFlow / totalInitialInvestment) * 100;
}
// Formatting Helper
function formatMoney(num) {
return '$' + num.toFixed(2).replace(/\d(?=(\d{3})+\.)/g, '$&,');
}
function formatPercent(num) {
return num.toFixed(2) + '%';
}
// Display Results
var cfElement = document.getElementById('res_monthly_cashflow');
cfElement.innerText = formatMoney(monthlyCashFlow);
if(monthlyCashFlow >= 0) {
cfElement.className = "rp-result-value rp-positive";
} else {
cfElement.className = "rp-result-value rp-negative";
}
document.getElementById('res_coc_return').innerText = formatPercent(cashOnCash);
document.getElementById('res_cap_rate').innerText = formatPercent(capRate);
document.getElementById('res_noi').innerText = formatMoney(annualNOI);
document.getElementById('res_total_expenses').innerText = formatMoney(totalMonthlyExpenses);
document.getElementById('res_mortgage').innerText = formatMoney(mortgagePayment);
}
// Run once on load to show initial values
window.onload = function() {
calculateRental();
};
How to Analyze a Deal with the Rental Property Cash Flow Calculator
Investing in real estate is one of the most reliable ways to build wealth, but simply buying a property doesn't guarantee a profit. To succeed, investors must analyze the numbers meticulously. This Rental Property Cash Flow Calculator is designed to help you determine the viability of a potential investment by calculating key metrics like Monthly Cash Flow, Cap Rate, and Cash-on-Cash Return.
Understanding the Key Metrics
1. Monthly Cash Flow
Cash flow is the net amount of money moving into or out of a business. In rental real estate, it is calculated as:
Formula: Total Rental Income – Total Expenses (Mortgage, Taxes, Insurance, HOA, Maintenance, Vacancy).
A positive cash flow means the property pays for itself and puts money in your pocket every month. A negative cash flow implies you are losing money to hold the property.
2. Capitalization Rate (Cap Rate)
The Cap Rate measures the natural rate of return on the property independent of debt (financing). It helps compare different properties as if they were purchased with all cash.
Formula: (Net Operating Income / Purchase Price) × 100
Generally, a higher Cap Rate indicates a better return, though it may also come with higher risk or a less desirable location.
3. Cash-on-Cash Return (CoC)
This is arguably the most important metric for leveraged investors. It measures the annual return on the actual cash you invested (Down Payment + Closing Costs), rather than the total value of the property.
Formula: (Annual Cash Flow / Total Cash Invested) × 100
For example, if you invest $50,000 to buy a $250,000 property and it generates $5,000 in positive cash flow per year, your Cash-on-Cash return is 10%.
Factors That Affect Your Profitability
When using this calculator, be realistic with your expense estimates to avoid surprises later:
Vacancy Rate: No property is occupied 100% of the time. A standard conservative estimate is 5% to 8% (representing about 2-4 weeks of vacancy per year).
Maintenance & Repairs: Even if a house is new, things break. Budgeting 5% to 10% of monthly rent ensures you have funds for painting, plumbing issues, or appliance replacement.
Property Management: If you don't plan to be a landlord yourself, expect to pay a property manager 8% to 12% of the monthly rent.
Example Scenario
Imagine you purchase a single-family home for $250,000 with a 20% down payment ($50,000). You rent it out for $2,200/month.
If your total expenses are roughly $1,834, your Monthly Cash Flow is roughly $366. This calculator performs this math instantly to help you decide if the deal fits your investment criteria.
{
"@context": "https://schema.org",
"@type": "FAQPage",
"mainEntity": [{
"@type": "Question",
"name": "What is a good Cash on Cash return for rental property?",
"acceptedAnswer": {
"@type": "Answer",
"text": "Many real estate investors aim for a Cash on Cash (CoC) return of 8% to 12%. However, this varies by market. In high-appreciation markets, investors might accept a lower CoC (4-6%), while in stable cash-flow markets, they might demand 12% or higher."
}
}, {
"@type": "Question",
"name": "How is Net Operating Income (NOI) calculated?",
"acceptedAnswer": {
"@type": "Answer",
"text": "Net Operating Income is calculated by subtracting all operating expenses (Management, Maintenance, Taxes, Insurance, Utilities) from the Total Income. Crucially, NOI does NOT include mortgage payments (debt service)."
}
}, {
"@type": "Question",
"name": "Why should I include a vacancy rate in my calculation?",
"acceptedAnswer": {
"@type": "Answer",
"text": "Including a vacancy rate creates a financial buffer. It accounts for periods where the property sits empty between tenants. Without this, you risk overestimating your annual income and running into cash flow problems."
}
}]
}