Rental Property Cash Flow Calculator
Analysis Results
Monthly Mortgage (P&I):
$0.00
Total Monthly Expenses:
$0.00
Monthly Cash Flow:
$0.00
Cash on Cash ROI:
0.00%
Cap Rate:
0.00%
Is Your Rental Property a Good Investment?
Real estate investing is all about the numbers. Unlike emotional purchases, a rental property must make mathematical sense to be a viable investment. This Rental Property Cash Flow Calculator is designed to help investors quickly analyze the profitability of a potential deal by looking at the most critical metrics: Cash Flow, Cash on Cash Return, and Cap Rate.
Understanding the Metrics
1. Monthly Cash Flow
Cash flow is the profit you bring in each month after all operating expenses and mortgage payments have been made.
Formula: Rental Income – (Operating Expenses + Debt Service).
Positive cash flow ensures the property pays for itself and provides you with passive income.
2. Cash on Cash Return (CoC ROI)
This is arguably the most important metric for investors using leverage (loans). It measures the annual return you make on the actual cash you invested (down payment + closing costs), rather than the total price of the property.
Formula: Annual Cash Flow / Total Cash Invested.
A CoC return of 8-12% is generally considered solid in many markets, though this varies by strategy.
3. Cap Rate (Capitalization Rate)
The Cap Rate measures the property's natural rate of return assuming you bought it in all cash. It helps you compare the profitability of similar properties regardless of financing.
Formula: Net Operating Income (NOI) / Purchase Price.
How to Use This Calculator
- Purchase Price & Loan: Enter the asking price and your financing terms. A standard investment loan requires 20-25% down.
- Income: Be realistic about rental income. Check comparable rentals in the area (comps).
- Expenses: Don't forget hidden costs. We've included fields for Taxes, Insurance, Maintenance, and Vacancy. A common mistake is underestimating maintenance; setting aside 5-10% of rent is a prudent rule of thumb.
Why "Vacancy Rate" Matters
No property is occupied 100% of the time. Tenants move out, and it takes time to clean and market the unit. Entering a 5% vacancy rate (about 18 days per year) creates a more conservative and safe financial projection.