Analyze the profitability of your real estate investment.
Combine: Tax, Insurance, HOA, Mgmt, Repairs
Cash on Cash Return
0.00%
Total Cash Invested
$0.00
Monthly Cash Flow
$0.00
Annual Cash Flow
$0.00
Monthly Mortgage Payment
$0.00
Net Operating Income (NOI) – Annual
$0.00
Understanding Cash on Cash Return
Cash on Cash (CoC) Return is widely considered the most important metric for real estate investors, particularly for rental properties. Unlike Cap Rate, which looks at the property's performance regardless of financing, CoC Return measures the efficiency of the actual capital you invested.
In simple terms, it tells you how hard your money is working for you. If you invest $50,000 to buy a rental property and it generates $5,000 in net cash flow per year, your Cash on Cash return is 10%.
The Formula
The calculation is straightforward but requires accurate inputs regarding your income, expenses, and financing.
Cash on Cash Return = (Annual Pre-Tax Cash Flow / Total Cash Invested) × 100
Annual Pre-Tax Cash Flow: This is your Gross Rent minus Vacancy, minus Operating Expenses (taxes, insurance, repairs, management), and minus your Mortgage Payments (Principal & Interest).
Total Cash Invested: This includes your Down Payment, Closing Costs, and any immediate Repair or Rehab costs required to get the property rentable.
What is a Good CoC Return?
While "good" is subjective, most seasoned 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 riskier or lower-cost markets, investors might demand 15% or higher.
Why Use This Calculator?
Real estate investing involves moving parts. A property might look profitable based on rent alone, but once you factor in vacancy rates (typically 5-10%), maintenance reserves, and debt service, the cash flow might be negative. This calculator helps you perform a "deal check" in seconds to ensure you aren't buying a liability.
function calculateCoC() {
// 1. Get Inputs
var purchasePrice = parseFloat(document.getElementById("purchasePrice").value) || 0;
var downPaymentPercent = parseFloat(document.getElementById("downPayment").value) || 0;
var closingCosts = parseFloat(document.getElementById("closingCosts").value) || 0;
var rehabCosts = parseFloat(document.getElementById("rehabCosts").value) || 0;
var interestRate = parseFloat(document.getElementById("interestRate").value) || 0;
var loanTerm = parseFloat(document.getElementById("loanTerm").value) || 0;
var monthlyRent = parseFloat(document.getElementById("monthlyRent").value) || 0;
var vacancyRate = parseFloat(document.getElementById("vacancyRate").value) || 0;
var otherExpenses = parseFloat(document.getElementById("otherExpenses").value) || 0;
// 2. Calculate Total Cash Invested
var downPaymentAmount = purchasePrice * (downPaymentPercent / 100);
var totalCashInvested = downPaymentAmount + closingCosts + rehabCosts;
// 3. Calculate Mortgage Payment
var loanAmount = purchasePrice – downPaymentAmount;
var monthlyRate = (interestRate / 100) / 12;
var totalPayments = loanTerm * 12;
var monthlyMortgage = 0;
if (loanAmount > 0 && interestRate > 0) {
monthlyMortgage = loanAmount * (monthlyRate * Math.pow(1 + monthlyRate, totalPayments)) / (Math.pow(1 + monthlyRate, totalPayments) – 1);
} else if (loanAmount > 0 && interestRate === 0) {
monthlyMortgage = loanAmount / totalPayments;
}
// 4. Calculate Net Operating Income and Cash Flow
var grossMonthlyIncome = monthlyRent;
var vacancyLoss = grossMonthlyIncome * (vacancyRate / 100);
var effectiveGrossIncome = grossMonthlyIncome – vacancyLoss;
var totalMonthlyExpenses = otherExpenses + monthlyMortgage;
var monthlyCashFlow = effectiveGrossIncome – totalMonthlyExpenses;
var annualCashFlow = monthlyCashFlow * 12;
// NOI Calculation (Income – Operating Expenses, excluding debt service)
var annualNOI = (effectiveGrossIncome – otherExpenses) * 12;
// 5. Calculate Cash on Cash Return
var cocReturn = 0;
if (totalCashInvested > 0) {
cocReturn = (annualCashFlow / totalCashInvested) * 100;
}
// 6. Formatting Helper
function formatCurrency(num) {
return "$" + num.toFixed(2).replace(/\d(?=(\d{3})+\.)/g, '$&,');
}
// 7. Update DOM
document.getElementById("resTotalInvested").innerText = formatCurrency(totalCashInvested);
document.getElementById("resMonthlyCashflow").innerText = formatCurrency(monthlyCashFlow);
document.getElementById("resAnnualCashflow").innerText = formatCurrency(annualCashFlow);
document.getElementById("resMortgage").innerText = formatCurrency(monthlyMortgage);
document.getElementById("resNOI").innerText = formatCurrency(annualNOI);
var cocElement = document.getElementById("resCocReturn");
cocElement.innerText = cocReturn.toFixed(2) + "%";
if(cocReturn < 0) {
cocElement.style.color = "#c0392b";
} else {
cocElement.style.color = "#27ae60";
}
// Show results
document.getElementById("resultsArea").style.display = "block";
}