function calculateRentalCashFlow() {
// Retrieve inputs
var price = parseFloat(document.getElementById('rp_price').value);
var closingCosts = parseFloat(document.getElementById('rp_closing_costs').value);
var downPercent = parseFloat(document.getElementById('rp_down_percent').value);
var interestRate = parseFloat(document.getElementById('rp_interest_rate').value);
var loanTerm = parseFloat(document.getElementById('rp_loan_term').value);
var rent = parseFloat(document.getElementById('rp_rent').value);
var tax = parseFloat(document.getElementById('rp_tax').value);
var insurance = parseFloat(document.getElementById('rp_insurance').value);
var hoa = parseFloat(document.getElementById('rp_hoa').value);
var vacancyRate = parseFloat(document.getElementById('rp_vacancy').value);
var repairsRate = parseFloat(document.getElementById('rp_repairs').value);
var capexRate = parseFloat(document.getElementById('rp_capex').value);
var managementRate = parseFloat(document.getElementById('rp_management').value);
// Validation
if (isNaN(price) || isNaN(rent) || isNaN(interestRate) || isNaN(loanTerm)) {
alert("Please enter valid numbers for Price, Rent, Interest Rate, and Loan Term.");
return;
}
// 1. Calculate Mortgage
var downPaymentAmount = price * (downPercent / 100);
var loanAmount = price – downPaymentAmount;
var monthlyRate = (interestRate / 100) / 12;
var numberOfPayments = loanTerm * 12;
var mortgagePayment = 0;
if (interestRate === 0) {
mortgagePayment = loanAmount / numberOfPayments;
} else {
mortgagePayment = loanAmount * (monthlyRate * Math.pow(1 + monthlyRate, numberOfPayments)) / (Math.pow(1 + monthlyRate, numberOfPayments) – 1);
}
// 2. Calculate Percentage Based Expenses
var vacancyCost = rent * (vacancyRate / 100);
var repairsCost = rent * (repairsRate / 100);
var capexCost = rent * (capexRate / 100);
var managementCost = rent * (managementRate / 100);
// 3. Operating Expenses (Excluding Mortgage)
var totalOperatingExpenses = tax + insurance + hoa + vacancyCost + repairsCost + capexCost + managementCost;
// 4. Net Operating Income (NOI)
var noi = rent – totalOperatingExpenses;
// 5. Cash Flow
var monthlyCashFlow = noi – mortgagePayment;
var annualCashFlow = monthlyCashFlow * 12;
// 6. Cash on Cash Return
var totalCashInvested = downPaymentAmount + closingCosts;
var cashOnCash = 0;
if (totalCashInvested > 0) {
cashOnCash = (annualCashFlow / totalCashInvested) * 100;
}
// 7. Cap Rate
var annualNOI = noi * 12;
var capRate = (annualNOI / price) * 100;
// Display Results
document.getElementById('res_cash_flow').innerHTML = "$" + monthlyCashFlow.toFixed(2);
document.getElementById('res_cash_flow').style.color = monthlyCashFlow >= 0 ? '#27ae60' : '#c0392b';
document.getElementById('res_coc').innerHTML = cashOnCash.toFixed(2) + "%";
document.getElementById('res_cap_rate').innerHTML = capRate.toFixed(2) + "%";
document.getElementById('res_noi').innerHTML = "$" + noi.toFixed(2);
var totalExpensesDisplay = totalOperatingExpenses + mortgagePayment;
document.getElementById('res_total_expenses').innerHTML = "$" + totalExpensesDisplay.toFixed(2);
document.getElementById('res_mortgage').innerHTML = "$" + mortgagePayment.toFixed(2);
// Show result container
document.getElementById('rp_results').style.display = 'block';
}
Mastering the Rental Property Cash Flow Calculator
Investing in real estate is one of the most reliable ways to build long-term wealth, but not every property is a good deal. The difference between a profitable investment and a financial burden often comes down to one metric: Cash Flow. This Rental Property Cash Flow Calculator is designed to give investors a clear, comprehensive view of a property's potential performance before a single dollar is spent.
Why Cash Flow is King
Cash flow is the profit remaining after all expenses, including the mortgage, have been paid. Positive cash flow ensures that the property pays for itself while potentially providing passive income. Negative cash flow means you are paying out of pocket to hold the asset, which increases your risk significantly.
Using a calculator helps remove emotion from the buying decision. By inputting realistic numbers for vacancy, maintenance, and management, you can see the "true" cost of ownership, not just the mortgage payment.
Understanding Key Investment Metrics
NOI (Net Operating Income): This is your total income minus operating expenses, excluding the mortgage payment. It measures the profitability of the property itself, regardless of financing.
Cap Rate (Capitalization Rate): Calculated as (Annual NOI / Purchase Price), this percentage helps you compare the return on investment across different properties as if you bought them with all cash. A higher Cap Rate generally indicates a better return (and potentially higher risk).
Cash on Cash Return (CoC): This is arguably the most important metric for leveraged investors. It measures the annual cash flow relative to the actual cash you invested (Down Payment + Closing Costs). It tells you how hard your money is working for you.
Hidden Expenses New Investors Miss
Many novice investors calculate profitability by simply subtracting the mortgage from the rent. This is a recipe for disaster. Our calculator forces you to account for the "silent killers" of cash flow:
Vacancy: Properties will not be rented 365 days a year. Budgeting 5-8% ensures you can cover costs during turnover.
CapEx (Capital Expenditures): Roofs, HVAC systems, and water heaters eventually break. Setting aside 5-10% monthly ensures you have the funds when big repairs are needed.
Property Management: Even if you plan to self-manage, you should budget for your time or the eventual need to hire a manager (typically 8-10% of rent).
Use this tool to run multiple scenarios. What happens if interest rates rise? What if rent is lower than expected? By stress-testing your numbers, you can invest with confidence.