Calculate your ROI, Cap Rate, and Monthly Cash Flow instantly.
Purchase Information
Loan Details
Income & Expenses (Monthly)
Please check your inputs. Values cannot be negative.
Investment Performance
Cash on Cash Return
0.00%
Monthly Cash Flow
$0.00
Cap Rate
0.00%
Net Operating Income (Annual)
$0.00
Total Cash Invested
$0.00
Monthly Mortgage Payment
$0.00
function calculateROI() {
// 1. Get Input Values
var purchasePrice = parseFloat(document.getElementById('purchasePrice').value) || 0;
var downPayment = 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 propertyTax = parseFloat(document.getElementById('propertyTax').value) || 0;
var insurance = parseFloat(document.getElementById('insurance').value) || 0;
var hoaFees = parseFloat(document.getElementById('hoaFees').value) || 0;
var maintenance = parseFloat(document.getElementById('maintenance').value) || 0;
var errorMsg = document.getElementById('errorMessage');
var resultsArea = document.getElementById('resultsArea');
// Validation
if (purchasePrice < 0 || downPayment < 0 || interestRate 0 && interestRate > 0 && loanTerm > 0) {
var monthlyRate = (interestRate / 100) / 12;
var numberOfPayments = loanTerm * 12;
monthlyMortgage = loanAmount * (monthlyRate * Math.pow(1 + monthlyRate, numberOfPayments)) / (Math.pow(1 + monthlyRate, numberOfPayments) – 1);
} else if (loanAmount > 0 && interestRate === 0) {
// Handle 0% interest edge case
monthlyMortgage = loanAmount / (loanTerm * 12);
}
// 4. Calculate Operating Expenses & Vacancy Loss
var vacancyLoss = monthlyRent * (vacancyRate / 100);
var effectiveRentalIncome = monthlyRent – vacancyLoss;
var totalOperatingExpenses = propertyTax + insurance + hoaFees + maintenance;
// 5. Calculate NOI (Annual)
var monthlyNOI = effectiveRentalIncome – totalOperatingExpenses;
var annualNOI = monthlyNOI * 12;
// 6. Calculate Cash Flow
var monthlyCashFlow = monthlyNOI – monthlyMortgage;
var annualCashFlow = monthlyCashFlow * 12;
// 7. Calculate Cash on Cash Return
var cashOnCash = 0;
if (totalInvested > 0) {
cashOnCash = (annualCashFlow / totalInvested) * 100;
}
// 8. Calculate Cap Rate
var capRate = 0;
if (purchasePrice > 0) {
capRate = (annualNOI / purchasePrice) * 100;
}
// 9. Display Results
document.getElementById('resCoc').innerText = cashOnCash.toFixed(2) + "%";
document.getElementById('resMonthlyCashFlow').innerText = formatCurrency(monthlyCashFlow);
document.getElementById('resCapRate').innerText = capRate.toFixed(2) + "%";
document.getElementById('resNOI').innerText = formatCurrency(annualNOI);
document.getElementById('resTotalInvested').innerText = formatCurrency(totalInvested);
document.getElementById('resMortgage').innerText = formatCurrency(monthlyMortgage);
resultsArea.style.display = 'block';
}
function formatCurrency(num) {
return "$" + num.toFixed(2).replace(/\d(?=(\d{3})+\.)/g, '$&,');
}
Understanding Cash on Cash Return for Rental Properties
When investing in real estate, calculating your potential returns accurately is crucial for making informed decisions. While metrics like "Cap Rate" and "ROI" are often thrown around, Cash on Cash Return (CoC) is widely considered the premier metric for rental property investors who finance their deals. Unlike Cap Rate, which looks at the property's performance without debt, CoC measures the efficiency of the actual cash you invested.
What is Cash on Cash Return?
Cash on Cash Return is a percentage that compares your property's annual pre-tax cash flow to the total amount of cash you invested to acquire the property. It answers the fundamental question: "For every dollar I put into this deal, how much cash am I getting back this year?"
The formula is:
Cash on Cash Return = (Annual Pre-Tax Cash Flow / Total Cash Invested) × 100
Components of the Calculation
Annual Cash Flow: This is your gross rental income minus all vacancies, operating expenses (taxes, insurance, HOA, repairs), and debt service (mortgage payments).
Total Cash Invested: This is not just the purchase price. It includes your down payment, closing costs, and any immediate rehab or repair costs required to make the property rentable.
Cap Rate vs. Cash on Cash Return
Many novice investors confuse these two metrics. Here is the difference:
Cap Rate (Capitalization Rate): Measures the return of the property as if you bought it entirely with cash. It indicates the intrinsic profitability of the asset itself. High cap rates generally indicate higher risk or lower asset quality.
Cash on Cash Return: Factors in leverage (your mortgage). Since most investors use loans to buy property, CoC is a more realistic measure of your actual pocket-money return.
What is a "Good" Cash on Cash Return?
There is no one-size-fits-all answer, as "good" depends on your strategy, the local market, and the economic climate. However, general benchmarks include:
8% – 12%: Often considered a solid return in stable markets.
15%+: Considered excellent, though often associated with riskier neighborhoods or properties requiring significant sweat equity (BRRRR strategy).
Below 5%: In high-appreciation markets (like parts of California or NYC), investors often accept lower cash flow returns in exchange for significant property value growth over time.
How to Improve Your Returns
If your calculation shows a lower return than you'd like, consider these strategies:
Increase Rent: Are you charging market rates? Small increases can significantly boost your bottom line.
Reduce Expenses: Shop around for cheaper insurance, appeal your property taxes, or manage the property yourself to save on management fees.
Refinance: If interest rates drop, refinancing can lower your monthly mortgage payment, instantly increasing cash flow.
Value-Add: Renovating the property to force appreciation and command higher rents is a proven way to spike your CoC return.
Use the calculator above to run multiple scenarios. Adjust the purchase price, down payment, or rental income to see how sensitive your returns are to these variables. This "stress testing" is vital for risk management in real estate investing.