function calculateCashFlow() {
// Get Inputs
var price = parseFloat(document.getElementById("propPrice").value);
var down = parseFloat(document.getElementById("downPayment").value);
var rate = parseFloat(document.getElementById("interestRate").value);
var term = parseFloat(document.getElementById("loanTerm").value);
var rent = parseFloat(document.getElementById("monthlyRent").value);
var expenses = parseFloat(document.getElementById("monthlyExpenses").value);
var vacancy = parseFloat(document.getElementById("vacancyRate").value);
// Validation
if (isNaN(price) || isNaN(down) || isNaN(rate) || isNaN(term) || isNaN(rent) || isNaN(expenses) || isNaN(vacancy)) {
alert("Please enter valid numbers in all fields.");
return;
}
// 1. Calculate Mortgage Payment (Monthly)
var loanAmount = price – down;
var monthlyRate = rate / 100 / 12;
var numberOfPayments = term * 12;
var mortgagePayment = 0;
if (monthlyRate > 0) {
mortgagePayment = loanAmount * (monthlyRate * Math.pow(1 + monthlyRate, numberOfPayments)) / (Math.pow(1 + monthlyRate, numberOfPayments) – 1);
} else {
mortgagePayment = loanAmount / numberOfPayments;
}
// 2. Calculate Vacancy Loss
var vacancyLoss = rent * (vacancy / 100);
// 3. Calculate Total Outflow
var totalMonthlyExpenses = expenses + vacancyLoss + mortgagePayment;
// 4. Calculate Cash Flow
var monthlyCashFlow = rent – totalMonthlyExpenses;
var annualCashFlow = monthlyCashFlow * 12;
// 5. Calculate Metrics
// Cash on Cash Return = Annual Cash Flow / Total Cash Invested (Down Payment)
var cashOnCash = 0;
if (down > 0) {
cashOnCash = (annualCashFlow / down) * 100;
}
// Cap Rate = (Net Operating Income / Price)
// NOI = Rent – (Operating Expenses + Vacancy) -> Excludes Mortgage
var monthlyNOI = rent – (expenses + vacancyLoss);
var annualNOI = monthlyNOI * 12;
var capRate = (annualNOI / price) * 100;
// Display Results
document.getElementById("resMortgage").innerText = "$" + mortgagePayment.toLocaleString(undefined, {minimumFractionDigits: 2, maximumFractionDigits: 2});
var flowEl = document.getElementById("resCashFlow");
flowEl.innerText = "$" + monthlyCashFlow.toLocaleString(undefined, {minimumFractionDigits: 2, maximumFractionDigits: 2});
flowEl.className = monthlyCashFlow >= 0 ? "result-value highlight-positive" : "result-value highlight-negative";
var annualEl = document.getElementById("resAnnualFlow");
annualEl.innerText = "$" + annualCashFlow.toLocaleString(undefined, {minimumFractionDigits: 2, maximumFractionDigits: 2});
annualEl.className = annualCashFlow >= 0 ? "result-value highlight-positive" : "result-value highlight-negative";
document.getElementById("resCoC").innerText = cashOnCash.toFixed(2) + "%";
document.getElementById("resCapRate").innerText = capRate.toFixed(2) + "%";
// Show Results Section
document.getElementById("resultsSection").style.display = "block";
}
Understanding Rental Property Cash Flow
Calculating cash flow is the fundamental step in evaluating a real estate investment. It determines whether a property is an asset that puts money in your pocket every month or a liability that drains your resources. This Rental Property Cash Flow Calculator helps investors analyze deals quickly by accounting for mortgage payments, operating expenses, and vacancy rates.
Key Metrics Explained
Monthly Net Cash Flow: This is the profit left over after all expenses, including the mortgage, have been paid. A positive number indicates a profitable rental, while a negative number warns of a monthly loss.
Cash-on-Cash Return (CoC): This percentage measures the return on the actual cash you invested (down payment). It is often considered the most important metric for investors using leverage (mortgages). A CoC of 8-12% is generally considered a solid return in many markets.
Cap Rate (Capitalization Rate): This metric evaluates the profitability of a property irrespective of its financing. It is calculated by dividing the Net Operating Income (NOI) by the property's purchase price. It helps compare properties as if they were bought with all cash.
How to Maximize Your Returns
To improve your calculator results, consider strategies to increase rent (renovations, adding amenities) or decrease expenses (shopping for cheaper insurance, self-managing the property). Even a small increase in rent or a decrease in interest rate can significantly impact your Cash-on-Cash return over the lifespan of the investment.
Common Expenses to Include
When using the "Monthly Operating Expenses" field, ensure you include: