Rental Property Cash Flow Calculator
Determine the profitability of your real estate investment with our free Rental Property Cash Flow Calculator. Accurately estimate your monthly net income by accounting for mortgage payments, taxes, insurance, vacancy rates, and maintenance costs.
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Financial Breakdown
Gross Monthly Income
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Fixed Expenses (Mortgage/Tax/Ins/HOA)
$0.00
Variable Expenses (Vacancy/Repairs/Mgmt)
$0.00
Total Monthly Expenses
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Net Monthly Cash Flow
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(Annual: $0.00)
What is Rental Property Cash Flow?
Rental property cash flow is the net amount of money remaining after all expenses related to the property have been paid from the monthly rental income. It is the single most important metric for buy-and-hold real estate investors, as it dictates the sustainability and profitability of the investment.
Positive cash flow means your property is generating profit. Negative cash flow implies that you are losing money every month to hold the property, which can be risky unless there is significant appreciation potential.
How This Calculator Works
Our calculator breaks down your finances into three core categories to give you an accurate picture of your investment:
- Gross Income: The total rent collected plus any ancillary income from parking, laundry, or storage fees.
- Fixed Expenses: Recurring costs that generally stay the same month-to-month, such as your mortgage (Principal & Interest), property taxes, homeowner's insurance, and HOA fees.
- Variable Expenses: These are often overlooked by novice investors. They include funds set aside for vacancy (when the unit is empty), maintenance/repairs (CapEx), and property management fees if you hire a professional manager.
Formulas Used
To calculate the monthly cash flow manually, you can use the following formula:
Cash Flow = Total Monthly Income – (Fixed Expenses + Variable Expenses)
Where variable expenses are calculated as percentages of the Gross Monthly Rent:
- Vacancy Cost = Monthly Rent × (Vacancy Rate / 100)
- Maintenance Cost = Monthly Rent × (Repair Rate / 100)
- Management Cost = Monthly Rent × (Management Rate / 100)
What is a Good Cash Flow?
While "good" is subjective based on your investment goals and market, most investors look for the following benchmarks:
- $100 – $200 per door: Generally considered acceptable for single-family homes with high appreciation potential.
- The 1% Rule: A rule of thumb suggesting that monthly rent should be at least 1% of the purchase price to ensure positive cash flow.
- Cash-on-Cash Return: Many investors prefer to look at ROI percentage rather than raw dollar amounts, targeting 8-12% returns annually.
Why Include Vacancy and Repairs?
Even if your property is currently rented and in perfect condition, it is financially dangerous to assume it will stay that way forever. Tenants move out (Vacancy), and water heaters break (Repairs). Allocating a percentage of rent (typically 5-10% for each) into a savings fund ensures you have the cash reserves to handle these inevitable costs without dipping into your personal pockets.