Rental Property Cash Flow Calculator
Purchase Details
Loan Details
Income & Expenses
Monthly Cash Flow Analysis
Gross Income
$0.00
Mortgage Payment (P&I)
$0.00
Total Operating Expenses
$0.00
Net Monthly Cash Flow
$0.00
Investment Returns
Cash on Cash ROI
0.00%
Cap Rate
0.00%
Net Operating Income (NOI – Annual)
$0.00
Total Cash Invested
$0.00
Understanding Your Rental Property Investment Analysis
Investing in real estate is one of the most powerful ways to build wealth, but the difference between a successful investment and a liability lies in the numbers. This Rental Property Cash Flow Calculator helps you look beyond the purchase price to understand the true profitability of a potential deal.
Why Cash Flow is King
Cash flow is the profit remaining after all expenses, including mortgage payments, taxes, insurance, and maintenance reserves, have been paid. Positive cash flow ensures the property pays for itself and provides you with monthly income.
Formula:
Monthly Cash Flow = Total Monthly Rental Income – (Mortgage Payment + Operating Expenses)
Monthly Cash Flow = Total Monthly Rental Income – (Mortgage Payment + Operating Expenses)
Key Metrics Explained
1. Cash on Cash Return (CoC ROI)
This is arguably the most important metric for rental investors. It measures the annual return on the actual cash you invested (down payment + closing costs), rather than the total loan amount. It allows you to compare real estate returns against other investment vehicles like stocks or bonds.
A common target for investors is a CoC ROI between 8% and 12%, though this varies by market.
2. Net Operating Income (NOI)
NOI is used to calculate the profitability of the income-generating property before financing costs and taxes. It tells you how much the property makes on its own operation.
NOI = Gross Income – Operating Expenses (excluding mortgage)
3. Cap Rate (Capitalization Rate)
The Cap Rate indicates the rate of return on a real estate investment property based on the income that the property is expected to generate. It is useful for comparing the raw potential of different properties without factoring in your specific loan terms.
Hidden Expenses to Watch For
Many new investors fail because they underestimate expenses. This calculator includes fields for:
- Vacancy Rate: You won't have a tenant 12 months a year forever. A 5-8% vacancy allowance is standard.
- CapEx (Capital Expenditures): Roofs, HVAC systems, and water heaters eventually need replacement. Setting aside 5-10% of rent monthly prevents large surprise bills.
- Management Fees: Even if you self-manage now, calculating a 8-10% management fee ensures the deal still works if you hire a professional later.