Rental Property Cash Flow Calculator
Monthly Income
Fixed Expenses
Variable Expenses (Estimates)
Calculation Results
Gross Monthly Income:
$0.00
Total Monthly Expenses:
$0.00
Operating Expenses (No Loan):
$0.00
Net Operating Income (NOI):
$0.00
Net Monthly Cash Flow
$0.00
How to Calculate Rental Property Cash Flow
Understanding cash flow is the cornerstone of successful real estate investing. Simply put, cash flow is the money left over after all expenses have been paid from the rental income. A positive cash flow indicates a profitable investment, while a negative cash flow means you are losing money every month to hold the property.
The Cash Flow Formula
The basic formula used in this calculator is:
Cash Flow = Gross Rental Income – Total Expenses
However, successful investors break this down further into fixed expenses and variable (often "phantom") expenses.
Inputs Explained
- Gross Income: This includes your monthly rent plus any additional income sources like coin-operated laundry, parking fees, or pet fees.
- Fixed Expenses: These are bills that generally stay the same every month. They include your Mortgage Principal & Interest (P&I), Property Taxes, Insurance, and HOA fees.
- Variable Expenses: These are often overlooked by new investors.
- Vacancy: You won't have a tenant 12 months a year forever. Allocating 5-8% helps cover turnover periods.
- Repairs: Leaky faucets and broken switches happen. Setting aside 5% creates a fund for these minor fixes.
- CapEx (Capital Expenditures): Big ticket items like a new roof or HVAC system. These are inevitable. Allocating 5-10% ensures you aren't bankrupt when the water heater bursts.
- Management: Even if you self-manage, it is wise to calculate a 8-10% fee to see if the deal still works if you decide to hire a pro later.
What is a Good Cash Flow Per Door?
Real estate markets vary significantly, but a common benchmark for "buy and hold" investors is $100 to $200 per door per month in pure cash flow after all expenses (including repairs and CapEx reserves). This ensures that the property pays for itself and provides a buffer against unforeseen economic downturns.
Net Operating Income (NOI) vs. Cash Flow
You will notice our calculator provides a figure for Net Operating Income (NOI). This is your income minus operating expenses, excluding your mortgage payments. This number is critical because it describes the profitability of the asset itself, regardless of how you financed it. Lenders look closely at NOI to determine if the property generates enough income to cover the debt service.
Use this tool to analyze potential deals quickly. If the numbers don't work here, they likely won't work in reality. Always verify your inputs with local property managers and lenders.